Europe’s generational wealth gap: older households more than eight times richer than young ones

Older households in Europe are worth more than eight times as much as younger ones, according to the European Central Bank’s 2023 Household Finance and Consumption Survey.

Across the eurozone and two other European countries, households headed by someone under 35 have a median net wealth of about 25,000 euros, while those headed by 55- to 64-year-olds are worth about 208,000 euros.

Net wealth includes property, cars, valuables and savings, minus debts. Under-35s hold just 2.8 percent of all household wealth in the 22 countries surveyed, while 55- to 64-year-olds hold the largest share at 24 percent.

The gap varies sharply by country. In Finland, under-35s hold 0.8 percent of household wealth, the lowest share of any country surveyed, while over-55s hold more than 71 percent. Young people’s shares are also small in Ireland at 1.4 percent, Austria at 1.6 percent, Greece at 1.8 percent and Germany at 2 percent.

Wealth is more evenly spread in Central and Eastern Europe. In Lithuania, under-35s hold 13.2 percent, against 15.9 percent for 55- to 64-year-olds. Their share is 12.3 percent in Croatia, 10.1 percent in Slovakia, 9.8 percent in Estonia and 11.1 percent in Malta.

Student protests that began in September in France have spread to more than 11 European countries as anger rises over high rents and fuel prices and cuts to public services. Many young protesters said they no longer expect to be better off than their parents.

Rising housing costs mean many young people cannot afford what their parents or grandparents could. Evelyn Astor of the European Social Observatory told Al Jazeera’s Counting the Cost programme that there has been a very strong increase in housing prices in both the rental and ownership markets.

Astor said this is reinforcing a sense of inequality, because ordinary families are struggling to pay their rents or buy homes while wealthy people with capital can make significant investments in the European housing market.

Prices of everyday goods and services, including food, energy, transport and household bills, have risen by 67.2 percent in the eurozone, Hungary and the Czech Republic since 2000. According to Eurostat, prices in Hungary have more than tripled, the steepest rise among the countries listed.

Eastern European countries have seen the sharpest increases, particularly since Russia’s full-scale invasion of Ukraine began in 2022, because many relied heavily on Russian energy supplies.

Prices rose by about 2 percent a year on average until 2022, when annual inflation in the EU hit 9.2 percent. The surge was driven mainly by energy costs. Inflation has since eased, but the price rises of the COVID-19 pandemic and the war in Ukraine have not reversed.