Millennials Say They Need $525,000 to Be Happy – And They're Right

What if you could afford to buy avocado toast *and* a house? Millennials can dream. In a new survey by financial firm Empower, 2,034 American adults were asked how much money they’d need to feel happy. Millennials aspired for the highest amount, saying they’d need to earn $525,000 (or around £420,000) a year, with $1.2 million in the bank. 

Gen Z, Gen X and boomers all reckoned they’d need get a yearly paycheck of $124,000 (or around £100,000) to be happy. Among all the age groups, men’s ideal paycheck was twice that of women’s ($380,000 as opposed to $182,000). 

Bit excessive, right? Apparently not: According to a 2023 study by Nobel Prize winner Daniel Kahneman, happiness does actually improve as salaries increase, and the effect persists with earnings up to $500,000 a year. Millennials, in other words, are exactly right.

It’s not surprising that millennials hope for the highest salaries – research shows that while they already earn more than previous generations, they effectively get far less bang for their buck. Analysis by economics blogger Kevin Drum reveals that, when adjusted for inflation, the average millennial earns 25 percent more by age 40 than boomers did. But millennials hold just a 5 percent share of US wealth, whereas boomers owned 21 percent of wealth by the same age. 

In effect, this is because wage increases are being outpaced by increases in the cost of living. Millennials have already faced two recessions, a rent crisis, soaring energy bills and rising student debt, so they need far more money to cover just the basics. Being able to splash out on small everyday luxuries without stress, they say, would boost happiness – for example, 62 percent of millennials said they’d happily pay £7 (or around £6) for a daily coffee “because of the joy it brings”, according to the Empower survey. 

This isn’t just a feeling among millennials, either. Of all the survey respondents, one in four said not getting paid enough was their main roadblock to achieving financial happiness, and 59 percent believed that happiness can be bought. Well, if happiness means having enough for decent accommodation, hobbies, energy bills, and maybe a few occasional stress-free pints, they’re right. More money would help.