First comes love. Then comes marriage. Then comes a baby in a baby carriage. Or so the rhyme goes—but life in the 21st century may force a change of plan.
Today, the nuclear family, a white picket fence and married parents is increasingly becoming an American dream that younger generations are simply no longer chasing. Either they don’t want it, or it’s not financially viable to attain.
Data suggests the average American is choosing a framework that looks less like getting married, buying a house, and then having kids. Instead, they are following quite a different path: likely having children before getting married, then buying a home.
Rachel Gottlieb, the managing director of Gottlieb Rose Wealth Management, which is part of UBS’s financial service portfolio and has $1.6 billion in assets under management, says that she is increasingly seeing people reach milestones in a different “order” because many of her clients are accumulating wealth later—but she reminds clients to be mindful because this comes with its own pitfalls.
Indeed, wealth experts like Gottlieb note that attempting to follow paths established by older generations operating in different economic climates could actually hinder the financial prospects of younger people trying to navigate conditions today.
And not only are younger generations having to come to grips with a new reality—their family and financial institutions are going to have to catch up too.
You’re the new example
Younger generations like Gen X, millennials and Gen Z might be familiar with the judgment that comes with doing things “out of order,” said Abby Davisson, co-author of Money and Love and the founder of the Money and Love Institute.
An overview of data indicates that many people are deciding to have children first (the average age of a first-time mother is 27, a first-time father 30) then get married (28 years of age for women, 30 for men) then buy a house (the average age of a first-time buyer in the U.S. is 36).
But a deeper look at the data shows a more complex story: in the U.S. the number of people deciding against marriage is steadily increasing. According to the Census Bureau, 46.4% of adults are single, representing 117.6 million people.
In 1960 just under 70% of men were married—that declined to just over 50% in 2023. Likewise, 65% of women were married in 1960—some 60 years later, that’s fallen to exactly 50%.
“There’s clearly a construct that we have been socialized to believe we should follow,” said Davisson. “That’s a mental model that many of us have, and it’s very powerful. But it’s not a fact and it’s certainly not what is going to work for everyone.
“Often, a negative consequence of doing things ‘out of order’ is the judgment of others. That’s something it’s helpful to make peace with if possible. One way to do that is to know that by forging a different path, you’re offering an example someone else in the future can look to and subsequently feel more confident about their own choices.”
Attitudes around children are also changing. According to a 2021 study from Pew Research, 44% of non-parents aged 18 to 49 said they’re unlikely to ever have children. That’s an increase of 7% from 2018.
The research also hints at why childless-by-choice adults don’t want children—the majority say they’re just not interested, while 17% said financial factors were a reason for their decision.
Flexibility is key
The experts Fortune spoke to all agreed on one thing: there’s no ‘right’ order to plan major financial and life milestones.
Davisson said although goals are “definitely” important to keep in mind, in the current economic climate flexibility is key: “In the last 10 years, interest rates have been all over the place. You can set a goal and then external circumstances can change—that goal may actually be out of reach in a way you didn’t expect it to be. So flexibility is important.”
Flexibility may also apply to conversations between partners, in which case the biggest hurdle is to establish open lines of communication. Davisson said couples need to enter into conversations seeking the best solution instead of a victory or a compromise.
She explained: “Sometimes we share our point of view and the goal is to get the other person to agree, but the goal is really to come to a mutually agreeable solution that feels okay to both of you.”
Be realistic
Some individuals are also going to have to give up the dream of what their adult life will look like, said Doug Wells, a partner at Salt Lake City-based Albion Financial Group.
The image of a new bride being carried over the threshold of a newlywed’s first home together is simply no longer reality, Wells said.
Speaking from his experience advising individuals with more than $1 million in investable assets, Wells explained: “There is a strong appetite to buy a house, but the feasibility of doing that and the challenge is becoming much more difficult, both for the downpayment and to service the loan.”
Indeed, the average down payment in the U.S. topped $31,000 in 2023, more than three times the $10,000 required just a decade ago.
Keeping up with the payments is also only getting harder, after the Federal Reserve went on a base rate hiking spree which has seen them settle at the highest rate in 22 years.
But there is a “secret” to home ownership, Wells said, which is the calculation of how long you’ll be in the property. Purchasing is worth doing if you stay in that home for at least seven years, preferably 10, he revealed.
“You’re probably better off pulling the trigger on buying a house as soon as you can,” in this case, he said. “You don’t know what might happen in six months or a year. Prices go up great, you’re already in, if prices go down it’s easier to upgrade.”
Get educated
According to the most recently available statistics from the Census Bureau around 46% of marriages end in divorce, making it all the more important in a difficult economic environment to ensure you’ve come to grips with your finances.
For example, UBS’s Gottlieb points out that having children with a person doesn’t offer the same assurances as pre-marital agreements, explaining: “You should potentially consider a prenup if you’ve established wealth because then if something were not to go right it would protect your pre-marital assets, which is irrelevant if you have kids or not.”
Depending on the order you commit to such decisions there’s more “complex” fine print, Gottlieb added: “There’s a lot of different considerations that I would advise you knowing before you make decisions—even though there’s no right or wrong path.”
Support from financial services for these modern-day dilemmas may also not be up-to-speed, warned Davisson. She explained: “Women technically could own their bank accounts and credit accounts it by the 1960s but it wasn’t until it was legally mandated, almost 15 years later, that it became common practice.”
She added: “Our institutions and our policies are often operating on outdated information. Enlightened institutions are the ones that really see an opportunity.
“It takes a bit of time, our financial institutions are some of the most archaic often to catch up to what is actually happening in society.”
