Never has a humble breakfast been so controversial.
Millennials, or those born between 1982 and 2002, have been attacked for their breakfast choices and how their love of the humble avocado is keeping them out of the property market rather than any external factor. It seems, when it comes to buying property, choose your breakfasts wisely.
Of course, the avocado metaphor is exactly that (a metaphor) and it would be flippant of me to take it so literally. But even the general idea that, there is no housing affordability crisis and the only thing keeping millennials out of the property market is their desire for a 'lavish' lifestyle, is quite simplistic and one most at the Fool disagree with.
But fear not my fellow millennials. Whilst property remains out of reach, there are other options to build wealth that you can take advantage of right now — and it is in your interests to get started as soon as possible.
You see, when it comes to getting rich (and isn't that what we all want to do?) the key component is time. And unlike the grumpy old suits throwing around the avocado example, it is something millennials have a lot of.
To see why this is important, look at the chart below.
The chart follows four people who each invest $5000 a year until they are 60 years old and earn a yearly return of 6%.
The results are powerfully clear. Despite the only difference being the total years invested, the person who started investing at 20 years of age (the millennial) ended up with around $825,000. This is almost double the runner-up and more than 10 times the amount the 50-year-old would have by the time they reach 60 years of age.
In reality, the situation is even better for the millennials. The above example ignores income from dividends which should grow along with the portfolio and can be reinvested. Throw this passive income stream in and the millennial would be a millionaire and the gap between them and the other four would only increase.
Why did I choose the six percent figure? Well, this is the approximate average return of the 'All Ordinaries Index' (which is an indicator of the performance of the general market), going back to 1994. Indeed, this is a benchmark most investors (including us) will try to beat.
So, millennials, ignore the barbs being thrown your way and enjoy your smashed avo. Use poor housing affordability to look elsewhere to build wealth and generate financial security through investing on the ASX. If you are unsure how, we will gladly help you.
