Millennials are doing the “success sequence” out of order and it could be leaving us in poverty.
Millennials get a bad rap. We don’t stay at jobs very long, we don’t like Hooters, and we are not interested in any more debt after college.
So when I heard Dave Ramsey discussing more research about Millennials’ inability to be successful due to something called the “success sequence,” I had to dig deeper into this rant.
Last month, the Federalist shared several findings from the Institute of Family Studies and other sources that suggest Millennials’ failure to follow the “success sequence” leads to poverty and financial volatility. Before we continue, let me define these terms and phrases for you.
Poverty is defined as lacking sufficient money to live at what is considered standard and normal in their respective society.
Financial Volatility is defined as the ability for your finances and income to change rapidly and unpredictably, typically for the worse.
The Success Sequence is defined by the Brookings Institute as keeping the following things in proper order, a) graduating from high school, b) marrying before having a child, and c) having children after the age of 20.
Wendy Wang and Bradford Wilcox’s research at Brookings stems from the National Longitudinal Survey of Youth at the Bureau of Labor Statistics. The U.S. Department of Labor began following a group of Millennials in 1997 and have since interviewed them on their life progress as recently as 2013.
The initial statistics of the research showed 79 percent of people who fail to follow the “success sequence” will live in poverty long-term, unable to meet their recurring financial obligations. Additionally, the study reports that 97 percent of people who do follow all 3 factors of the success sequence are more likely to thrive.
However, these numbers decrease when you throw in race. Only 59 percent of Blacks can flourish when following the “success sequence.” As Brookings details in another article – systemic issues in education, politics, and the job market continue to leave the African-American community falling far behind.
Add in the growing rates of single parenthood across white and black communities, the Urban Institute reported 15 years ago that white single parents will still see more success than black single parents, maintaining a net worth of 13 times the average black family. That is still the case in 2017.
This isn’t the first time that it’s been mentioned how whites who follow the “success sequence” will always earn more than blacks. The National Review points out that in all instances, even if a black person graduates, gets married first, then has children, they may have more like a 76 percent chance of being middle class or better. Still 21 percent less than a white individual.
I found the results of the research, its variables and controls, so insightful that I asked 3 Millennial couples about their thoughts regarding the “success sequence” and if they felt the research to be reflective of their past, present, and future.
Craig, 30 and Lisa, 27 | Combined Income $200,000+/- | Atlanta, Ga
Ethnicity: African-American
Dating: 11 years.
Engaged: 5 years.
Living Together: 2 month, after marriage.
Married: 2 months.
Children: 0
Occupation: Craig is a Lawyer. Lisa is an Epidemiologist.
Do you agree with the “Success Sequence?”
L: I’ve seen both sides of it but in my experience it has more to do with the kids and not the cohabitation because most of their income go towards the kids. In my family, I’ve seen women in my family that were not able to obtain higher education because they had to take care of their kids and I’ve seen women able to obtain higher education and get those higher paying jobs despite having children.
C: Generally speaking, that [the stats] is a fair statement. I would disagree with Lisa. There is something distinguishing people who cohabitate with a child versus people who are married and living with children. There is a conscious decision being made to unify and it’s more of a team, for better or worse. Happily ever after is not the case for everyone’s marriage but there is a characteristic that differentiates these people. It’s just better to unify then have children. I don’t know many people that cohabit with or without children for many, many years and they are ultimately okay when the other says “Don’t worry about getting married.”
In your case, you’ve followed the “Success Sequence.” What would you say is the reason for the path you’ve taken?
C: We have similar values. We didn’t believe in playing marriage – where you move in and you act married, then you get tired of the person so you end up not committing. Our values are based on Christian beliefs but not because the Bible told us to do it. This is just something we both agreed on.
Have you seen the “Success Sequence” or lack there of play out in your own families?
C: My parents, yes. They got married and started having children. To my knowledge they didn’t move in prior to marriage.
L: I haven’t seen it in my family. My parents did not follow the sequence. They had a kid before marriage, moved in after the child, then got married later.
C: Her parents are rich though, don’t let her fool you.
Do you agree or disagree that there is economic power in marriage?
C: I’ll be very honest, there is truth to the correlation between marriage and money. In my experience, life is expensive and married people work together. Two incomes are better than one and when you are co-habitating there isn’t always union or stability.
L: Like Craig was saying, joint income and joint goals helps everyone agree on where the money goes and how it grows.
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Steven, 34 and Lauren, 28 | Combined Income $60,000+/-| Houston, Tx
Ethnicity: Caucasian
Dating: 5 years.
Engaged: N/A
Living Together: 3.5 years.
Married: N/A
Children: 1 child from Lauren’s previous relationship. 1 child between Steve and Lauren.
Occupation: Steve is in Sales. Lauren is a Bartender.
Do you agree with the “Success Sequence?”
L: I feel like that makes sense. Lots of places won’t give you a job without a high school education. And as for having a kid, it takes up a lot of your time and a lot of your money. No matter what salary you are in, you are going to have less money because you have to have a job to support a child. If you want to continue your education or move up in your job, the time commitment makes it difficult when you have a child to take care of.
S: Children have definitely made it a lot more difficult. Daycare is not cheap.
In your case, you did not follow the “Success Sequence.” What would you say is the reason for the path you’ve taken?
S: We’re making do with what we got. While we may not have the disposable income to take three vacations a year, we’re self aware of our situation to where we can budget for what we want and need.
L: I had my daughter when I was 19.
Have you seen the “Success Sequence” or lack there of play out in your own families?
S: My dad is on his 5th wife right now. My whole family has tarnished the idea of marriage for me so in my mind, we’re gonna get married but it has to be right.
L: My parents got divorced when I was 5. Before they got divorced, we were in a better economic class. They both financially struggled after they got divorced.
S: I think me and Lauren could live our whole life without getting married and increase our income. We still have room to move up. While we are currently sitting around $30,000 each right now, I think we still have room to get there. I feel like we’re gonna get married, we’ve talked about it a lot.
L: I feel like the fact that we have a child, whether or not we are married, its more beneficial for us to live together in order to increase our income considering time restraints, childcare, returning to school, etc. Marriage costs money.
Do you agree or disagree that there is economic power in marriage?
S: Do I think we’re poor? No. Do I think we’re under the middle-class line? Yes. Our bills get paid every month, we just don’t have that extra available. $10,000 more for each of us per year would go a long way. A $50,000 income for each of us is achievable.
L: The fact that we’re not married and we don’t pull our income, budget together, makes it different though. If we were married, I think we’d be more aware of exactly how much money we have and where it’s going. At this point, we each have our own job, our own car. We do split the bills at home but aside from rent, utilities, and daycare, that’s it. I think if we were married, we would be able to budget differently.
S: I don’t know if I agree with that. I’m not paying off her credit cards. I also don’t think being married would significantly increase our class status. I’m thinking if we do it the right way maybe we’d save $1,000 a year. I don’t know.
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Adam, 31 and Hannah, 28 | Combined Income $80,000+\-| Denver, Co
Ethnicity: Caucasian
Dating: 5 years.
Engaged: 1 year, 8 months.
Living Together: 3.5 years before marriage.
Married: 4 months.
Children: 1
Occupation: Small Business Owners.
Do you agree with the “Success Sequence?”
A: I can see how it could work. Not that we received a lot of pressure but definitely from our grandparents, they don’t necessarily love the idea of living together before you get married and definitely not with a kid. Obviously we went backwards on all those steps. For us it was perfect. We got to talk about everything before it happened. We wanted to live together to make sure that we could survive living together and take the next step.
In your case, you did not follow the “Success Sequence.” What would you say is the reason for the path you’ve taken?
A: We mutually discussed getting married and got married well after our son Jackson was born, about a year after. We didn’t want to just get married because we had a kid. We wanted to make sure that we were really ready as a couple.
H: We were friends before dating. I got pregnant within the first year of us dating. With that change, I wasn’t ready for any other big changes in my life. We just needed to be mentally and emotionally there; having that connection without just saying “We have a kid so we might as well get married.”
A: I think we had to be emotionally ready but we also had to discover more about each other and make sure we actually connected on the level of marriage.
Have you seen the “Success Sequence” or lack there of play out in your own families?
A: Most people I know had kids in their 20’s, are definitely more financially worse off than we are. The friends I know that got married after college, even with kids are well off. Once we became more serious, we got a joint checking account and that was way before we were married. We’ve pretty much been living like we were married.
H: Financially, it was definitely harder before we got married. We were both working retail jobs and we both lost our jobs as we were starting the business so we were living off our savings and $600 monthly paychecks. Financially that was hard and I just found out I was pregnant. Starting a business, the money is just not flowing and wedding planning took a lot of extra things. I just taught myself over the years to budget and always see where the money is going. It’s all about knowing what is coming up and cutting your spending. We have to put our son’s wellbeing ahead of ourselves.
A: I think that’s the biggest thing where my friends have problems with… they fail to plan.
Do you agree or disagree that there is economic power in marriage?
A: Having a dual income is great although some couples don’t share their income. Pretty much everything we make goes into the business and we figure out how to distribute it to ourselves.
H: Dual incomes do help. People have asked me ‘what is married life like?” and we’ve been living together so long, not much has changed. I don’t know that marriage has an advantage other than tax purposes.