Background
In previous posts we’ve looked the dual challenges that Americans spend more and save less. The next series of posts look at why. This first view looks at the marriage and birth age trends that may be postponing the point at which Americans “settle down” and start saving. Are people postponing marriage and having kids?
Findings
Absolutely. Two charts track the marriage and childbirth trends since 1970:
- Americans are getting married later: Since 1970, the median age of first marriage for both men and women has climbed about 7 years. It’s now age 30 for men and 28 for women.
- Kids come later too: Over the same time period, the mean age of the mother at the birth of her first child has risen 5 ½ years. (see below on why mean is an OK measure here).
- Cultural and economic factors drive the marriage “delay”: Some people choose to live together without getting married. This is up from almost no one in 1970, to 10% of 25-34 year olds today. Social attitudes toward the need to marry, and early, have changed substantially. Economically, women say they want to marry employed men. However, among never-married 25-34 year olds, the ratio of employed men to all women has dropped from about 1.1 in 1970 to 0.9 in 2012. In other words, there aren’t enough “qualified” (loaded concept) men available.
Implications
These findings suggest that marriage and birth age trends drivers may be reducing the savings rate. We already know Millennials are “boomeranging” back home due to financial difficulties. Less financial stability probably means less savings than previous generations at that age. Psychologically, pre-marriage Millennials may not take savings as seriously as married couples. Therefore, if they marry and have children later, they are going to be later to the savings party.
This is only the first part of the analysis of demographics on savings rate. Still, already this suggests that working with Millennials on saving early in life may be even more important than with previous generations.
The small print
The marriage data is from the US Census. The childbirth data is from the National Vital Statistics reports. Note that the marriage data is median age, the childbirth data is mean age. The two sources usually report on these different calculations. Analysis of some median vs. mean data for childbirth age shows the numbers aren’t very different and show the same trend so I’ve used the readily available mean childbirth age.