Federal Reserve Bank of St. Louis REVIEW Fourth Quarter 2014 305 The State of Young Adults ’ Balance Sheets: Evidence from the Survey of Consumer Finances

T he past decade has ushered in historic swings in housing, labor, and stock markets. Ithas also prompted growing interest in how young adults, who are only beginning tointeract with credit markets and accumulate assets, have fared in the wake of the Great Recession. Recently, it has been claimed that today’s young adults are less financially inde-pendent than previous generations of young adults, an assertion most notably captured by the unprecedented increase in the fraction of young adults living with a parent (see, for example, Thompson, 2012; Parker, 2012; Fry, 2013; Dettling and Hsu, 2014). The possibility of delayed financial independence among young adults has raised concerns about potential adverse effects on aggregate consumer spending and economic growth. Financial well-being early in life also has important implications for lifetime wealth accumulation; recent evidence The authors investigate recent trends in the financial circumstances of young adults using data from the triennial Survey of Consumer Finances (SCF) from 2001 to 2013. They examine trends in young adults ’ net worth, break down the composition into specific assets and liabilities, and describe young adults ’ experiences with credit markets. The analysis focuses on three main comparisons: (i) trends over time (ii) between young adults and older adults and (iii) between young adults in 2013 (members of the “Millennial Generation”) and young adults in 1989 (members of “Generation X”). They find that between 2001 and 2013, young adults experienced a decline in net worth, driven largely by decline