Growing up in the asset economy

The shape of young people’s insecurity is structured by their place within the maturing asset economy. The asset economy, as developed by Lisa Adkins, Melinda Cooper, and Martijn Konings (Reference Adkins, Konings and Cooper2020), characterises present-day capitalism as one where assets, primarily property assets, are the determinants of class and inequality. The asset economy, they argue, arose from the neoliberal political project that deployed monetary and fiscal policy reform to tackle inflation in the 1970s to preserve the wealth of the financial elite. The price-wage spiral of the 1970s was responsible for the decline in the value of financial assets held primarily by the upper class, but for the working class, much of the effects of consumer price inflation were mitigated through union-secured pay rises that were tied to the inflation rate and a robust social security system that protected worker’s incomes during periods of unemployment or injury (Adkins et al., Reference Adkins, Konings and Cooper2020). Concerned with the erosion of their financial and political power, a coalition of financial elites and policymakers emerged, determined to redistribute financial gains back towards asset owners rather than wage earners (see Harvey, Reference Harvey2005; Adkins et al., Reference Adkins, Konings and Cooper2020). This redistribution of wealth back into the hands of the financial elite was made possible through reductions in capital gains taxes, driving up of interest rates to create a recession large enough to erode the power of the labour movement, and a new orthodoxy of inflation-targeting monetary policy. These actions ushered in a new era of low wages, low inflation, and soaring asset prices spurred on by cheap credit and favourable tax policy, shaping contemporary inequality as centred on the haves and have-nots of asset ownership (Adkins et al., Reference Adkins, Konings and Cooper2020).

In selling this programme to the low and middle classes who would ultimately be worse off, governments framed the acquisition of assets as a layman’s pathway to securing one’s own stability and prosperity without intervention from the state (Harmes, Reference Harmes2001; Davis, Reference Davis2009). For the middle class, homeownership was presented as not only a secure source of shelter but also a personal bank from which the household could extract liquidity to finance their lives (Konings and Adkins, Reference Konings and Adkins2022; Cook, Reference Cook2023). Having entered the property market, households are encouraged to build their private wealth portfolios beyond the family home – that is, investing in markets to secure their retirement and purchasing additional properties as sources of income and capital gains (see Harmes, Reference Harmes2001, Davis Reference Davis2009, Hacker, Reference Hacker2006; Adkins et al., Reference Adkins, Konings and Cooper2020). This accumulation of assets to secure one’s own livelihood is supported by a transformed welfare-state regime that is premised on encouraging and preserving the gains of asset accumulation through tax subsidies on property and pension funds, and fiscal policies focused on preserving asset values (see Stebbing and Spies-Butcher, Reference Stebbing and Spies-Butcher2016; Konings et al., Reference Konings, Adkins, Bryant, Maalsen and Troy2021; Bryant et al., Reference Bryant, Spies-Butcher and Stebbing2024). These subsidies have replaced the social expenditure model of the twentieth century, where the state intervened by securing a liveable wage for workers and providing monetary support for those in long-term unemployment (Castles, Reference Castles1994). This transformation of the welfare state has meant that political and public expectations of social policy have become centred on enabling an individual to purchase assets and maintaining (and even appreciating) the value of these assets in the long term so that households can draw on their wealth portfolios as a social security net, rather than relying on government payments (see Bryan and Rafferty, Reference Bryan and Rafferty2018; Konings et al., Reference Konings, Adkins, Bryant, Maalsen and Troy2021). This state-sanctioned assetised pathway has been successfully traversed by the generations coming of age at the advent of the neoliberal state, benefitting from having a baseline portfolio of existing property ownership or having the liquidity to purchase assets prior to their rapid inflation in the early 2000s (Adkins et al., Reference Adkins, Konings and Cooper2020). For young adults born into the asset economy, the pathways of success laid out by their families, teachers, and political leaders have become difficult to gain access to, blocked by the constraints of insecure work, weakened higher education pathways, declining homeownership, and inadequate retirement funds.

Homeownership, the premier instrument for households to build wealth in the asset economy, is becoming increasingly out of reach for young adults who are unable to raise enough liquidity to get a foothold in the property market (Adkins et al., Reference Adkins, Konings and Cooper2020; Troy et al., Reference Troy, Wolifson, Buckley, Buckle, Adkins, Bryant and Konings2023). The combination of low-interest rates and fiscal policies that encouraged property accumulation has caused an environment where house prices have rapidly appreciated, but wages have been slow or stagnant to keep up, constraining aspiring homeowners’ ability to source the capital needed to purchase a property (Adkins et al., Reference Adkins, Konings and Cooper2020). Being locked out of homeownership, today’s young adults are being characterised as ‘generation rent’, a category used to describe the prevalence of young people being housed in the private rental market and expecting to do so for most of their lives (see Hoolachan et al., Reference Hoolachan, McKee, Moore and Soaita2017; Pawson et al., Reference Pawson, Hulse and Morris2017; Stebbing and Spies-Butcher, Reference Stebbing and Spies-Butcher2016). The private rental market is known as being inherently unstable with unregulated rent increases, no-fault evictions, and a lack of landlord regulations. The precarious nature of the private rental sector has caused young people to feel unable to realise their desires to create a ‘home’ and security for themselves (Hoolachan et al., Reference Hoolachan, McKee, Moore and Soaita2017; Colic-Peisker and Johnson, Reference Colic-Peisker and Johnson2012). In considering the place of young people in the asset economy, it is clear that we are entering a new mature stage of the asset economy whereby property assets are locked in place, no longer providing a layman’s pathway to asset-based security.

Beneath the top-level concern with soaring house prices and insecure rental markets lies a constellation of other constraints that combine to push young people further away from achieving the aspirational good life as laid out by the asset economy. First, wage stagnation and fragmented employment are central to how young people are forced to wrangle with the broken promises of the asset economy, stymying their ability to secure the loans needed to purchase assets (Konings and Adkins, Reference Konings and Adkins2022; Leyshon and Thrift, Reference Leyshon and Thrift2007). Comprising a significant proportion of the cohort deemed the precariat, young people’s experiences of employment are characterised by a lack of forward progression, uncertain and undefined hours, variable incomes, exposure to arbitrary dismissal, and denied access to paid leave (see Standing, Reference Standing2011). Understandably, this structure of precarious employment has been linked to a decline in mental well-being and young people’s sense of control (Chesters et al., Reference Chesters, Smith, Cuervo, Laughland-Booÿ, Wyn, Skrbiš and Woodman2019). The longevity of precarious employment that now defines young people’s career trajectory challenges the previous assumption that young people will simply grow out of the ontological insecurity that defines youth and instead this insecurity follows them into their adult lives (Chesters et al., Reference Chesters, Smith, Cuervo, Laughland-Booÿ, Wyn, Skrbiš and Woodman2019; Kelly, Reference Kelly2017).

The pervasiveness of insecure work across all industries has also meant that higher education no longer provides the guaranteed security it once did. The neoliberal political project framed higher education as an investment in one’s human capital, an investment that would bring returns in the form of increased earning capacity and good jobs (Cooper, Reference Cooper2019). In promoting higher education in this way, the university system was supercharged by widespread enrolments that transformed higher education into a mandatory part of building a life rather than an optional pathway into adulthood. Furthermore, as the state has retreated from funding higher education, young adults are forced to take on student loans in order to make this ‘investment’ into their future (Cooper, Reference Cooper2019). As a result, the promises made by politicians at the start of the century are wearing thin as the increase in higher education participation has led to greater competition for a shrinking number of graduate jobs and the pathways into jobs that were once previously non-graduate (i.e., nursing) now requiring a university degree (Harrison, Reference Harrison2019). This has meant that higher education is no longer seen by young adults as an investment in appreciating their human capital but rather a compulsory insurance against an uncertain future (Harrison, Reference Harrison2019; Kelly, Reference Kelly2017).

Recently, the post-pandemic cost-of-living crisis has made the material constraints of young people more acute. In the United Kingdom, over half of young people believed that the cost-of-living crisis will more adversely impact their lives than the COVID-19 pandemic with the rising cost of living being classed as one of their biggest worries for the future (Princes Trust, 2023). Responding to the increasing cost of living, young people in Australia have had to cut their spending not only on discretionary items but also essentials spending, including reducing or entirely skipping meals, avoiding medical services, and increasing their working hours/starting a side hustle to earn additional income (ACYP, 2023; CommBank iQ, 2023) These feelings of anxiety and worry, alongside material practices of drastic lifestyle change, show how the material insecurity shared by young people has coalesced into a heightened experience of financial crisis.

These material constraints associated with being a young adult in the asset economy mean that young people are no longer able to take the same property-based pathway to adulthood as their parents. Instead, they are forced to forge new and creative ways in which to build a life within this precariousness. One pathway for securing the normative pathway of property ownership modelled by older generations is to turn to their families as banks to help fund their purchase of property assets. It has become an increasingly common practice for parents to be called upon to provide financial assistance towards their adult children’s deposit for a mortgage or put up their houses as collateral against their children’s housing loans (Cook, Reference Cook2021; Troy et al., Reference Troy, Wolifson, Buckley, Buckle, Adkins, Bryant and Konings2023). This familial financial support has expanded to include rental payments, higher education fees, and everyday living expenses as young adults’ financial resources are increasingly constrained by the rising costs of housing and education, alongside income streams that are regularly interrupted because of insecure employment contracts (Woodman et al., Reference Woodman, Maire and Cook2024). Considering these intergenerational transfers within the wider context of contemporary neoliberalism and the asset economy, recent literature has suggested that we are seeing a return to the family as the safety net for economic security, filling the vacuum left by austerity governments (Adkins et al., Reference Adkins, Konings and Cooper2020; Cooper, Reference Cooper2019; Ronald and Arundel, Reference Ronald and Arundel2023). In other words, young people’s ability to navigate the asset economy is increasingly tied to the financial resources of their families.

But the ability to access intergenerational transfers is not guaranteed, and for young adults unable to access family funds, they are looking for new pathways through which they can protect themselves against precariousness and instability. However, these pathways often remain referential to their parent’s strategies for stability – as seen most pertinently in the practices of young investors turning to financial assets as a low-cost substitute for the property assets accumulated by their parents. This embeddedness of assets in the norms of contemporary life has been forged in the discursive environment of financialisation established in the late twentieth century, which presented financial markets and asset ownership as a means through which an individual can grow their wealth and insure against risk.

Young adults as financialised subjects

The choices that young people make to navigate their material insecurity in the asset economy are shaped by the discursive context of neoliberal financialisation. This discourse steers individuals to manage their precariousness through private risk instruments such as insurance, homeownership, market-based pensions, and financial markets. Market participation, in this context, is presented as the solution to material constraints that emerged from the withdrawal of the twentieth-century welfare state and is pitched as a new pathway to social mobility. For young people, this discourse was at its peak while their parents were navigating early adulthood, creating a generation of asset owners that now are passing on these asset and finance logics down to their children who are building their lives in a distinctly different world. This section explores how the discourse of financialisation has defined the ways in which young adults are strategising to cope with their material insecurity.

The strength of the discourse of financialisation lies in its integration with the contours of everyday life. The management of one’s money has become framed through government policies and self-help resources as a fundamental part of building a life free of anxieties and full of affluence. For Randy Martin (Reference Martin2002: 6), cultures of financialisation, such as advertising, self-help books, financial education programmes, and government policies, have shaped a new money mentality whereby ‘money is not to be left untouched but constantly fondled, mined daily like a well stocked refrigerator’. In other words, the discourse of financialisation is built around creating a new psychology that views money as productive. Adoption of financial practices has been successful as households pursued investment in retirement funds and built up private savings. However, these discourses of financialisation have not been able to successfully create widespread disciples of finance. Instead, what is more common is the rise of reluctant financial actors who engage with financial markets with the sense they have no choice but to participate (Hillig, Reference Hillig2019; Langley, Reference Langley2007). The continued engagement with financial markets and assets, therefore, does not stem from an awakened financialised spirit within the individual, but rather the financialisaton of the pillars of security needed to build a life, most notably shelter and retirement.

The transformation of the home from a consumption item necessary for survival to a wealth-accumulating asset has irrevocably thrown individuals into financialised subjectivities, regardless of whether they own or rent (see Adkins et al., Reference Adkins, Konings and Cooper2020). Politically, homeownership has been framed as the first pillar of an individual’s successful engagement with personal finance. During the growth of neoliberalism in Thatcherite England, homeownership was presented as the first step of demonstrating one’s ability to manage finances, with share ownership an extension of this financialised life (Edwards, 2017; Hillig, Reference Hillig2019). This ordering of investment has led to the residential property being seen as a superior good, a more stable, more understandable, and more appropriate vehicle for investment for the layman investor rather than dabbling with the vagaries of the share market (Hillig, Reference Hillig2019). The consequence of this has been the widespread rapid acceleration of house prices and concentration of property ownership in the hands of those who entered adulthood at the onset of financialised neoliberalism (Adkins et al., Reference Adkins, Konings and Cooper2020). This has left today’s young adults with little opportunity to access this perceived foundation for a financialised life – turning to the share market not as the second step but as the only step they can take to become financial subjects.

Some have argued that the privatisation of the pension, rather than homeownership, was the catalyst for financialisation in neoliberal societies, as privatised pensions fused one’s retirement with the performance of financial markets (Harmes, Reference Harmes2001). The privatisation of the pension was made possible by dismantling the defined benefits scheme where employers paid their employees pensions (increasing with years of service) and introducing the privatised pension where employers pay a set amount into their employees’ individual retirement funds (Harmes, Reference Harmes2001; Davis, Reference Davis2009). These investments were managed by the workers themselves, meaning that employees could no longer passively expect a secure retirement but rather were pushed to become active investors in their own future (Harmes, Reference Harmes2001; Davis Reference Davis2009). Neoliberal governments in their project to individualise and privatise retirement pursued a programme of fearmongering that state-supplied pensions would be exhausted by the time that current workers would reach retirement. This rhetoric allowed governments to concurrently cut state-supplied pensions and develop tax favourable policies that encouraged their citizens to relocate their security from the state to the market, creating a population of citizens whose futures were grounded in market logics (see Harmes, Reference Harmes2001; Davis Reference Davis2009; Hacker, Reference Hacker2006). The power of this discourse is most felt by young adults, who are aware that retirement funded through the state is no longer a possibility (Harmes, Reference Harmes2001) and are also increasingly concerned that retirement through markets also might not be guaranteed (Jans et al., Reference Jans, Golder, Pepe, Burgunder, Bohn and Rey2020). What is interesting here is that despite the failure of privatised pensions to adequately build confidence in young people about their security in retirement, they are still turning to the same market to solve their material precarity. Meaning that despite materially falling short, the discursive project of financialisation is alive and well.

The success of the discursive project of financialisation can be tied to political programmes orientated towards forming financialised subjects. These programmes and policies were designed to focus on creating a new generation of citizens already educated in financial logics. The creation of financial literacy or financial well-being as a calculable measure for public policy meant that possessing financial knowledge became part of the art of governing, a measure of the health of the population (Marron, Reference Marron2014). For Doncha Marron (Reference Marron2014: 500), the creation of a measure for financial knowledge shifted what was once a political concern for consumer responsibility in markets to a more concrete and definable attribute of the individual that needed programmed intervention. This was specifically done through financial education programmes that were deployed in schools and taught to parents, orientated towards teaching children money management practices such as opening a savings account, compound interest, the dangers of debt, and the importance of risk management (Maman and Rosenhek, Reference Maman and Rosenhek2020; Reference Maman and Rosenhek2023; Marron, Reference Marron2014; Santos, Reference Santos2017). As a result of these interventions, today’s young adults have had no lived experience outside of the financialised asset economy and have been exposed to its logics through their families and schooling since birth. For these children of the neoliberal project, the only solution to precarity is the market.

Having been born into this matured asset economy, young people are increasingly expressing pessimism towards their financial lives, seeing themselves as financially worse off than their parents (Walsh et al., Reference Walsh, Gallo Cordoba, Cutler, Huynh and Deng2023). This financial pessimism is grounded in young people’s doubts about their ability to purchase property, support a family, and achieve financial security in the future (see Jans et al., Reference Jans, Golder, Pepe, Burgunder, Bohn and Rey2020; Princes Trust, 2023; Walsh et al., Reference Walsh, Gallo Cordoba, Cutler, Huynh and Deng2023). By placing their financial pessimism in their context of having been born into the asset economy rather than having entered the asset economy with existing assets (i.e., a primary residence) or with wages that would enable asset ownership, we are better able to understand the root cause of this pessimism. What is peculiar here is that this financial pessimism has not resulted in young adults’ rejection of the failed asset-based pathway, but the asset-based pathway has morphed to capture new pathways towards an assetised life, including seeking intergenerational transfers for homeownership (Cook, Reference Cook2021; Troy et al., Reference Troy, Wolifson, Buckley, Buckle, Adkins, Bryant and Konings2023), enrolling in multiple post-graduate certifications to improve employment prospects (Harrison, Reference Harrison2019; Kelly, Reference Kelly2017), and investing in the financial market to build wealth (Hendry et al., Reference Hendry, Hanckel and Zhong2021). In grappling with this paradoxical approach, I argue that we need to look deeper at the affectual undercurrents that shape their actions. Specifically, I argue that anxieties over one’s precariousness manifest in strategies that might seem irrational or contradictory on the outside, but provide a source of comfort and security as they mirror past techniques for mitigating one’s precariousness. For young people in the asset economy, this is through the continued pursuit of the asset accumulation strategies modelled by the generations before them, but instead of the seemingly stable property assets purchased by their parents, young people are turning to volatile financial assets.

Precariousness as a structuring affect

It becomes clear in looking through the material and discursive aspects of young people’s lives that there is a mismatch between the broken promises made by neoliberal politics and young people’s continued engagement with financial markets to secure their future. It is in wrangling with this inconsistency that I turn to the use of precariousness as a theoretical framework to make sense of young adults’ behaviours within the asset economy. Sarah Knudson and Kathrina Mazurik (Reference Knudson and Mazurik2021) deploy precariousness as a lens to understand why young adults’ financial goals are motivated by the pursuit of stability (long-term employment, homeownership, and debt reduction). In doing so, they understand young people’s financial goals for stability as shaped by the material insecurity of lacking assets or tangible resources and the subjective feelings invoked by the threat or reality of precariousness (Knudson and Mazurik, Reference Knudson and Mazurik2021: 291). Furthermore, Dan Woodman (Reference Woodman2022) brings together discourses around precariousness and the asset economy to argue that young adulthood has become defined by speculative logics applied to their careers, educational pursuits, and homeownership, as they engage in individualised risk calculations to cope with their increasingly precarious lives. Precariousness as a frame to understand young people’s orientation towards stability provides a useful lens through which we can find meaning in young people’s turn towards passive investing and their re-imagination of volatile financial markets as stable generators of guaranteed returns.

Put simply, precariousness refers to the existential truth of our vulnerability, a shared recognition that our bodies are ‘precarious, vulnerable and mortal’ (Lorey, Reference Lorey2015, quoted in Puar, Reference Puar2012: 172). Precariousness stems from the mortality of the body, the reality that we are always at the helm of factors beyond our control, always being ‘given over’ to others in navigating the perilous process of living (Butler, Reference Butler2011; Reference Butler2016). Precariousness is this intensity of bodily vulnerability. It is an unnamed sense of one’s own mortality and a drive to protect against it. For Butler (Reference Butler2016: 29), precariousness is a state that co-exists with birth itself; we are not born and then become precarious, but rather we are precarious from birth. From the moment of life itself, our precariousness is embedded in our dependence on others and others’ dependence on us; our survival depends on a ‘social network of hands’ that protect us from the potential risks to our lives and livelihoods (Butler, Reference Butler2016: 29). The anxieties surrounding our precariousness does not only manifest in emotional responses to life or death survival but makes itself known in the minute practices of building a life. For Lauren Berlant (Reference Berlant2011), the influence that our existential precariousness has over our lives means that it is best understood as an affect – a pre-conscious, pre-individual, and distinctive way of organising feelings of existence (see Anderson, Reference Anderson2014; Reference Anderson2016; Clough, Reference Clough2009; Massumi, Reference Massumi1995).

In characterising precariousness as an affect, we must make a distinction between affect and emotion. In Brian Massumi’s (Reference Massumi1995: 88) distinction, affect is characterised as an intensity, while emotion is the manifestation of that intensity into ‘narrativisable action-reaction circuits, into function and meaning’. Perhaps more simply, Lauren Berlant (Reference Berlant2011: 159) points to a divergence in ‘a structure of affect and what we call that affect when we encounter it’. For precariousness, then, its form as a structure of affect refers to the ontological vulnerability of the body developed by Butler and Lorey, but what this affect might be called when it is encountered could be anxiety, stress, shame, focus, greed, etc. Those named emotions could be attached to a range of other structures of affect in different contexts, but in reference to precariousness as a structure of affect, we can understand all these emotions as shaped by a fervour to avoid the shared sense of ontological vulnerability. By making this distinction between the structure of affect and the naming of the affect, we can open up our understanding of young people’s engagement with the share market – they could feel a sense of security in habitually purchasing shares regardless of the current state of the market, they could feel elation in purchasing stocks low and selling high, and they could feel dejected and defeated by the failure of the market to achieve promised returns. All these named feelings and responses can be connected back to precariousness as an affect that structures this response. Precariousness as a structure of affect allows us to contextualise practices that may seem diametric or unusual (pursuing higher education despite dwindling graduate jobs, entering the share market even when it is crashing) as a response to this intensity of bodily vulnerability.

However, precariousness is not only an affect but rather becomes material through the political ordering of exposure to its vulnerability. The folding of precariousness back into its material and political context is defined by Butler and Lorey in their respective writing as precarity. For Judith Butler, it is important not to look only at the existential rendering of precariousness as a shared ontology (‘we are all precarious’), but to recognise that

In other words, when we think of precariousness as an affect, we must recognise that exposure to the bodily ontology of precariousness is unequally distributed and thus has diverse impacts on how precariousness is felt, acted on, and responded to. This recognition is the foundation for the concept of precarity, whereby one’s exposure to precariousness is determined by broader social and political structures (Butler, Reference Butler2011; Lorey, Reference Lorey2015). Precarity then is the state that emerges when power maximises precariousness for some and minimises it for others (Butler, Reference Butler2016: 23). This politicised organisation of precariousness draws from the anxious response to recognising one’s shared mortality and vulnerability with others, but rather than leading to a shared solidarity, the response has often been to hoard protection against precariousness to a select few (Butler, Reference Butler2016; Lorey, Reference Lorey2015). In our contemporary political order, Isabel Lorey (Reference Lorey2015: 56) argues that the neoliberal push for individual security was premised on exposure to precariousness. For Lorey, in retreating from the social obligations of the welfare state, the neoliberal political project was able to capitalise on precariousness as an affect to push individuals into protecting themselves as individuals from their vulnerability through financialised pathways of homeownership, private insurance, and retirement funds.

Precarity is best seen in the asset economy through the entrenchment of policies designed to appreciate the value of properties for existing homeowners, such as negative gearing, capital gain tax exemptions, mortgage holidays, and the exemption of the primary home from means tests (see Konings et al., Reference Konings, Adkins, Bryant, Maalsen and Troy2021). These policies have become locked into the political landscape due to the dominance of the home-owning class as a voting bloc who first and foremost are focused on protecting the investments they have made to protect against their precariousness (Konings et al., Reference Konings, Adkins, Bryant, Maalsen and Troy2021). In doing so, these homeowners are pulling up the rug on their non-owning counterparts whose incomes are insufficient to save for a house deposit or service the mortgage for these property assets that are rapidly increasing in value (Konings et al., Reference Konings, Adkins, Bryant, Maalsen and Troy2021). Here the affective environment of precariousness comes into play, as property owners emotionally push back against any policy that might erode the buffer that they have created against their existential precariousness.

Neoliberalism’s successful use of the affective environment of precariousness to push for individual responsibility is particularly useful in understanding the responses of young adults to the material constraints of their lives. It is through the anxious attachment to precariousness that young people continue to pursue pathways that promise future security, such as higher education, homeownership, and share investment, even if they are unreachable or unable to satiate the affective intensity of precariousness.

In considering precariousness as an affect and precarity as a political order, I argue for conceiving precariousness as a structuring affect. Borrowing from Berlant’s (Reference Berlant2011: 158) term ‘structure of affect’, which she uses to distinguish between the affect itself and the named response to that affect, I argue that precariousness as an affect is structuring, it frames the material contours of everyday life, the political positions and divisions in society, and the creation of instruments, devices, and rhetoric orientated towards it. It is the fear of succumbing to our vulnerability that underpins how we relate to each other in society. For Butler (Reference Butler2016), this should result in an intensified solidarity as we recognise our shared vulnerability. But within the individualised asset economy that defines our existence, our fear of precariousness manifests in a hoarding of capital and political support for instruments (policies, laws, and regulations) that appreciate the value of the stock of capital that we hold, pushing our precariousness onto others who are unable to accumulate assets. The structuring power of precariousness in the asset economy is best seen in the intergenerational inequality between older generations who were able to accumulate property assets as a method of insurance against their precariousness and now hold these assets hostage from young adults seeking to purchase property for their own security. When applied to understanding young people’s entry into financial markets, it becomes clear that their motivations for investing in financial assets stem from a desire to mitigate their precariousness in a way that aligns with the normative construction of an asset-based ‘good life’ that is constantly attempting to evade their grasp.

Seeking stability in unstable markets

In understanding precariousness as a structuring affect, we can conceive of household behaviour in the asset economy as driven by a desire to escape the discomfort of precariousness. In the past, homeownership has been conceived as the superior asset for addressing precariousness – providing both shelter and a store of wealth to be drawn upon across the life course (Adkins et al., Reference Adkins, Konings and Cooper2020). However, for young adults, this asset is increasingly becoming out of stock due to the material constraints imposed on them in a neoliberal assetised society. Their response is best understood by drawing on Lauren Berlant’s (Reference Berlant2011: 249) work on the operationalisation of precariousness as a structure of affect in which she argues that given the choice between fighting the system that orders their precarity or adapting to its logics, young people choose to ‘get caught up in a circuit of adjustment … in order to stay in proximity to some aspirations that had gotten attached to the normative good life’. In other words, young adults, in fashioning a life free from precariousness, look at the examples of their parents and older generations who forged their security through property ownership and search for a similar instrument through which they can align their life trajectory within the idealised assetised existence. For a cohort of young people, financial assets such as shares, cryptocurrency, and index funds appear as the instruments through which they can fashion a proximal life to their parents in a maturing asset economy. This section examines more closely the strategies and instruments that make up the culture of passive, long-term investing that has captured young investors who have turned to financial markets in their search for stability.

Young investors, when discussing their financial goals expressed a desire to establish a sustainable income stream, build an emergency fund for unexpected expenses, secure a comfortable retirement, and save for future large expenses including homeownership and travel (ASX, 2023; Hanckel and Hendry, Reference Hanckel and Hendry2024; Lin et al., Reference Lin, Bumcrot, Mottola, Valdes and Walsh2022; Tang and Lee, Reference Tang and Lee2020). Although often found to have a higher appetite for risk in their investments than their older counterparts (Lin et al., Reference Lin, Bumcrot, Mottola, Valdes and Walsh2022; Whelan et al., Reference Whelan, Jupp, Smith and Moffatt2024), the goals of these young people have been described as a ‘defensive’ investing mindset (Tang and Lee, Reference Tang and Lee2020). Rather than desiring to be rich or vastly improve their quality of life, their motivations for investing coalesce around a perceived need to mitigate exposure to unforeseen events and establish income security to fund basic needs (Tang and Lee, Reference Tang and Lee2020). Young investors with this defensive orientation typically take a long-term and passive approach to investing, which can be described as the habitual purchase and holding of financial investments with the intention of selling at a future point where one’s portfolio meets a certain financial goal (i.e., retirement or house deposit). This strategy is grounded in the belief that wealth is built through the accumulation of time spent in the market (Chen, Reference Chen2020). This stands in stark contrast to the speculative traders whose financial strategy is to time the market, buying shares when the price is low and then selling when the price is high. The long-term horizon of young passive investors frames their approach to market volatility, where periods of market instability or a single-day loss of portfolio value are seen as inconsequential for their investments over the long run (Hendry et al., Reference Hendry, Hanckel and Zhong2021). In their research with young Australian investors, Benjamin Hanckel and Natalie Ann Hendry (Reference Hanckel and Hendry2024: 9) found that these investors preference for a long-term investing strategy acted as ‘a tranquiliser’ against unpredictability both in financial markets and in their lives more broadly by promising a positive return in some indeterminate future.

In this long-term investing culture, the engine of this accumulation is compound interest. As explained in the education arm of Bloom (2024), a long-term investing app marketed to young investors, in the choice between receiving a million dollars now and a penny that doubles each day for 30 days, the better choice is the penny, which through the ‘superpower’ of compound interest would become over $5.3 million dollars at the end of 30 days. To emphasise the power of compound interest further, they proclaim that if you ‘started that penny just 5 days earlier, it would have become $172 MILLION!’ (Bloom, 2024). In the culture of long-term investing, the power of compound interest is harnessed through leveraging time; the earlier you begin the engine of compounding, the wealthier you become. Time here is presented as a resource that young people are rich in, compensating for their lack of liquidity. Time has been conceived as a core feature of the asset economy, an active force that households must wrangle with in keeping up with the demands of their credit and debt obligations in order to survive (see Adkins, Reference Adkins2018; Konings and Adkins, Reference Konings and Adkins2022; Konings, Reference Konings2018). For young investors, time appears as a productive resource, a mitigator of their limited liquidity as their abundance of time smooths out the volatility of short-term market movements and gives enough room for compounding interest to provide meaningful returns.

In this narrative of long-term investing, the market appears to young investors as a machine that, if regularly paid into and if the investor is patient, spits out wealth at the other end. In this way, the share market as a whole is reimagined to reflect the characteristics and promises of property assets where the constant need to inject liquidity into the asset is rewarded by the possibility of capital gains in some indeterminate future (Konings and Adkins, Reference Konings and Adkins2022). In framing the market in this way, young investors are able to bolster themselves against the anguish of precariousness by mirroring past generation’s strategies for securing the good life, steadily and habitually injecting liquidity into their assets to build wealth and security for themselves and their families. These long-term, passive, and quotidian forms of investment employed by young investors can also be likened to the practice of hoarding, where objects are held not for the attachment to the objects themselves but as an attachment to a process (Berlant, Reference Berlant2011). Berlant’s (Reference Berlant2011: 42) description of hoarding as delegated to the realm of fantasy (rather than the real life of circulation) and performing the ‘enjoyment of an infinite present of holding pure potential’ maps itself onto young investor’s practices of long-term, passive, and routine investing, whereby the constant input into financial markets holds their future in a fantastic imaginary abundance at the unknown moment where they withdraw from the market.

In terms of the actual investment portfolios of young investors, exchange-traded funds (ETFs) have emerged as a popular asset class (ASX, 2023; Charles Schwab, 2022). ETFs are shares in a managed fund that typically owns shares in the top companies on a stock exchange. When investors purchase an ETF, they buy into the value of the fund rather than the shares themselves. Their popularity with young people is due to the accessibility of this asset class through FinTech platforms that offer micro-investments in ETFs for as low as $5 (Pearler, 2024). Alongside the material ease of entry, ETFs’ popularity also stems from their structure of holding a basket of high-performing shares (such as Apple or Amazon), which enables the desired diversification of one’s portfolio without having to purchase individual stocks. The traditional pathway of portfolio diversification through the purchase of a wide range of different companies’ stocks requires both a large amount of liquidity to invest especially if wanting to invest in high-performing companies and a significant level of financial knowledge to research the companies to invest in, especially when trying to invest in emerging markets. ETFs provide an investment instrument that subverts the significant capital and knowledge required for the purchase of individual stocks, enabling investors to buy into funds that invest in the top 100 or top 500 best-performing companies. Young people, therefore, are drawn to the diversification embedded in ETFs viewing them as safer investments than individual company stocks or cryptocurrencies (Hendry et al., Reference Hendry, Hanckel and Zhong2021). This grounding of ETF’s popularity in its ability to secure the perceived safety of diversification at a fraction of the cost is a reminder that even in the more accessible asset class of financial markets, asset inequality is still present as newer investors with limited liquidity, namely, young adults, remain locked out of purchasing shares in companies with sizeable dividends and large capital gains. Instead, young adults entering the market for the first time are relegated to the more affordable diversification pathway of investing in ETFs that keep them proximal to the highly capitalised portfolios of institutional investors.

It is in this paradoxical pursuit of a stable life in unstable financial markets that precariousness as a structuring affect provides a new perspective for understanding the way that young people fashion their lives in a maturing asset economy. Precariousness as a structuring affect can used to explain how young adults, despite the broken promises of the asset economy, continue to engage in asset-based practices to create a life that is ‘in proximity of a feeling of something that is strangely both enigmatic and simplifying’ (Berlant, Reference Berlant2011: 166). This feeling of ‘something’ in this context refers to the absence of the affectual atmosphere of precariousness. The promise of not feeling precarious enlivens us to pursue channels that promise this very feeling, even if these pathways become out of reach. Growing up in the asset economy has meant that young people have not experienced alternative pathways that might protect them against their precariousness, namely, a socialised, state-provided safety net. Being raised within the discursive environment of the asset economy, young people have been conditioned to think that an asset portfolio is the only way to protect themselves. This is most powerfully illustrated by young investors who seek alternative asset classes when homeownership becomes unaffordable. These young investors participate in financial markets in the hope that by pursuing a path that stays faithful to the normative logics of the asset economy, they will remain in the proximity of a life liberated from the persistent threat of precariousness.