The cost of living is shaping up as a defining issue for the November midterms — but its bite is not equal across generations. Recent economic data and expert analysis show retirees are generally better shielded from current price pressures, while younger adults, especially those starting families, are bearing the heaviest burden.
Why older Americans are less exposed
Several factors help explain why people 65 and older are faring relatively better. A large share of seniors own their homes outright or have mortgages locked in years ago, which reduces the impact of today’s elevated interest rates. They tend to drive less, hold onto vehicles longer and therefore feel gasoline and auto-financing shocks less acutely. And a steady portion of retiree income—Social Security—is protected by cost-of-living adjustments; the Social Security Administration recently announced a 3.6% increase in benefits for 2027.
“Put together, the income and expense mix looks more favorable for older age groups,” said William Galston of the Brookings Institution. While seniors still face higher prices for essentials like food and utilities, experts say their overall exposure to the most volatile cost categories is smaller.
Young households face sharper increases
By contrast, households led by people in their 30s and early 40s are feeling a squeeze from several directions. Housing costs have jumped faster than incomes, mortgage payments are more expensive than in recent years, and childcare — a necessity for many young families — has climbed well above the overall inflation rate.
Using Bureau of Labor Statistics data to compare price changes across generations, Moody’s economist Mark Zandi found that millennials and Gen Z have experienced larger cumulative increases in consumer prices than older cohorts. “The data show younger adults are encountering higher inflation for the items they spend most on,” Zandi said.
Mortgage costs illustrate the divide: average rates for a 30‑year fixed loan have risen into the mid‑7 percent range, pushing monthly payments toward record highs as a share of median family income. At the same time, median home values have outpaced wage growth, widening the affordability gap for first‑time buyers.
- Mortgage pressure: Monthly payments on a typical 30‑year mortgage now take a larger share of household income than in recent years.
- Housing vs. wages: From 2019 to 2024, inflation‑adjusted median home values rose much faster than incomes for households under 40.
- Childcare costs: Families can spend roughly 9%–16% of median income on full‑time care for one child, sometimes more than rent.
- Wealth divergence: Median net worth fell sharply for the youngest families while increasing significantly for the oldest.
Political consequences as midterms approach
That economic split matters at the ballot box. Younger voters reporting greater financial strain could translate into higher turnout among those seeking change — a dynamic that pollsters and strategists say tends to favor Democrats in the current environment.
A Reuters/Ipsos survey released last week found a large majority of Americans place at least some blame for higher costs on the White House; the sentiment is broad across party lines. Michael Reid of the Royal Bank of Canada suggests that when families feel squeezed, they often look to replace current leadership with candidates promising relief.
Nonpartisan analysts such as the Cook Political Report have already flagged the House majority as vulnerable for Republicans this cycle, and Democrats see opportunities in the Senate as well. Economic perceptions will likely be central to how voters weigh incumbents’ performance.
How the safety net and asset gains favor retirees
Beyond steady Social Security checks, older Americans benefit from a social safety net and asset gains that younger households have not equally shared. The Federal Reserve’s Survey of Consumer Finances shows large gains in net worth for the oldest households between 2022 and 2025, while net worth for families under 35 declined.
Stocks — which have posted strong returns in recent years — are disproportionately held by older, wealthier households, boosting retirees’ portfolios. Research from the JPMorgan Chase Institute also indicates wealthier retirees increasingly tapped investment accounts in 2025 to support spending, a sign they are converting assets into consumption.
Still, retirees face higher healthcare outlays. Medicare Part B premiums are projected to rise to about $209.50 per month in 2027, according to the Medicare Board of Trustees, and long‑term care remains a significant expense for many elderly households.
What this means for everyday choices
For younger families the options are limited: accept higher housing costs and bigger monthly payments, seek lower‑cost childcare arrangements, take on additional debt or pare back spending. Some households can substitute cheaper groceries or cut discretionary spending, but essential expenses like housing and childcare offer little room to maneuver.
For policymakers and campaigns, the challenge is clear: messaging that speaks directly to the expenses hitting younger voters — housing affordability, childcare relief, and wage growth — may resonate more than broad economic claims celebrating market gains.
As the midterms near, the generational gap in economic experience is likely to sharpen debate and influence which issues dominate local and national campaigns. Voters weighed down by day‑to‑day costs will be paying close attention to which candidates promise tangible relief.
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Jordan Keller specializes in analyzing the US financial markets. With concrete recommendations, he helps you secure and boost your investments by providing strategies that adapt to market fluctuations.