Dave Ramsey: Millennials and Generation Z who live at home are ‘driving wrecks’

This group (ages 18 to 29) is driving luxury growth in the US, Morgan Stanley analysts said in a December report. The analysis found that living at home has freed up the discretionary spending of older Generation Z and younger millennials, allowing them to buy designer handbags and watches. Ramsey, a self-made millionaire and author of numerous personal finance books, sparked the trend on a recent episode of “The Ramsey Show.”

“So let me get this straight. You live in your mom’s basement, but you have a Coach purse,” Ramsey said. “Here’s what’s going to happen – you can’t avoid life, it’s coming for your butt.” Mom can’t protect you.”

Saying the trend will lead to a “driver’s accident”, Ramsey blames not young adults but their parents for “not being in control” of helicopter parenting and “coddling”.

“The problem is you’re in debt, you’re not making enough money and you’re not doing enough to go out and change it,” added co-director Jade Washoe. “Mom and Dad can’t do this for you.”

But the situation is a bit more complicated than that. The economy, not parenting or a lack of willpower, forces many young adults to live at home. (Ramsey’s team did not respond to a request for comment.)

Living at home can help young adults save money

Millennials, the highly educated group that graduated in the Great Recession and its aftermath, entered a tough job market while saddled with massive student debt. Many have since made strides in wealth creation, but the long process of getting there has prompted them to marry, start families, and buy homes later than their parents did—if they participated in these life milestones at all. .

“It’s almost like we don’t want millennials to get a piece of the American dream,” said Andre Perry, a senior fellow at the Brookings Institution. Fortune in November.

Gen Z has also faced its share of financial challenges, with the oldest thrown into the pandemic and a bleak job market at the foot of their careers. Although they got a head start on the job as the job market recovered and the threat of recession motivated them to save more than other generations, many doubt they will be able to save enough for retirement and/or to buy a home.

Both generations are now facing 40 years of inflation for the first time, and some can’t afford a roof over their heads. U.S. rents rose so much last year that Americans now have to work six hours more a month to afford them than they did before the pandemic.

According to a survey by, 39% of millennials who moved back in with their parents last year did so because of high rent. More than half said they moved back home to save more money.

It is proof that life at home with parents be able to be financially beneficial. “This shouldn’t necessarily be seen as a negative thing as long as there are clear fiscal goals,” said Doyle Williams, executive vice president of Country Financial, back in 2018, adding that it can help millennials build an emergency fund and save for a down payment .

At the time, the country’s Financial Security Index found that 35% of millennials still lived at home with their parents. That’s one in four today, according to a survey by A separate study found that nearly 30% of Gen Z adults still live at home with their parents, deterred from moving out on their own by the rising cost of living.

Of course, some young adults prefer to treat themselves—after all, Gen Z is motivated by having more material possessions than any other generation and started spending on these luxuries earlier. But if that’s the case with those who live at home, that doesn’t mean they aren’t also wasting money. It also doesn’t mean that every boomerang child spends on luxury.

Many just hope that living with their parents will help them one day afford what mom and dad once found easier to achieve.

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