In a world where lots of people make life choices as they go along without doing much planning, some researchers believe there’s a formula you can follow to avoid poverty. And it’s not too complicated.

The so-called “success sequence” has three steps: Finish high school, get a full-time job and avoid having children before you marry.

Now a new report from the American Enterprise Institute and the Institute for Family Studies suggests that this recipe for a good life won’t just boost individual earning power. The researchers think the success sequence can also end some long-observed racial income disparities.

In “The Power of the Success Sequence for Disadvantaged Adults,” published Thursday, authors Wendy Wang and Brad Wilcox push back against the notion that the success sequence only works for whites because of the structural disadvantages others face.

“Young adults who manage to follow the sequence — even in the face of disadvantages — are much more likely to forge a path to a better life,” they wrote in the report.

The report finds 96% of Black and 97% of Hispanic millennials who follow all three steps when they’re in their 20s are not poor when they reach their mid-30s. The same is true for 94% of millennials who grew up in poor families and 95% raised in families where mom and dad didn’t stay together.

Even among those who don’t get a college degree, 95% of people who stick to the three-point path are not poor by their mid-30s, the report says.

Instead, they are on their way to the middle class and experiencing the American dream, said Wilcox, a sociologist who is a senior fellow at the Institute for Family Studies, a visiting scholar at the American Enterprise Institute and director of the National Marriage Project at the University of Virginia.

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Tackling push back

Wilcox said a report they did on the success sequence several years ago was criticized as being relevant only for well-educated young white adults, but not so much for young adults who were Black, Hispanic or disadvantaged.

There was some truth to the critique, he said.

“We certainly found in the research more generally that access to a good job, education and marriage are conditioned by race and income growing up,” he told the Deseret News. “We don’t deny the importance of the structural barriers that confront Black and disadvantaged adults.”

The lingering question was whether that success sequence could overcome those barriers.

The new report shows that if a young adult gets at least a high school diploma, works full time in his 20s and gets married before having kids, that adult will be more likely to stay out of poverty.

That’s true, Wilcox added, for young adults of all backgrounds. Despite barriers during childhood related to race, income or family instability, following the sequences proved to be associated with a much lower risk of poverty in adulthood. And the association held on after the researchers controlled for race/ethnicity, family income, family structure, test scores and education. 

“Specifically, the odds of being poor in your mid-30s are 11 times higher for young adults who did not complete the success sequence versus those who did,” the report says.

Wang and Wilcox said the success sequence matters the most for young adults from less advantaged backgrounds, who often lack access to the resources that make the steps easier to take. They wrote that those young adults need “quality schooling, better job opportunities and resources and guidance to help them navigate relationships.”

Racial differences

Skipping one or more of the steps can lead to poverty, especially for young adults who are either Black or Hispanic, according to the research.

Black Americans who didn’t take any of the success sequence steps are very apt to be poor before they reach 38, at 73%. The number is lower among Hispanics, at 54%, but still bad news. The share in poverty for whites who didn’t graduate from high school, who work part time or less and who had children before marriage is 39%. So whites fare better there.

Wang, director of research for the Institute for Family Studies, thinks those results show that racial minorities, especially Blacks, face stronger structural barriers to getting ahead financially, compared to other groups. But that harm isn’t static, she added.

“The encouraging news is that with completion of each step of the success sequence, the racial gap narrows rapidly,” she said, leaving only 4% of Blacks and 3% of Hispanics poor in their mid-30s.

“Stunningly, the racial gaps in poverty are almost closed,” Wang and Wilcox wrote.

But “Black boys face a lot of challenges in America: Even Black boys from wealthier families still earn less in adulthood than white boys who grew up in similar backgrounds,” the report says.

The researchers highlighted research by Harvard economist Raj Chetty and his colleagues that shows young Black males raised in top-income households are more likely to become poor than to maintain a spot in that top income bracket as adults. But among those who complete the three-step sequence, 93% do not become poor and nearly 4 of 5 make it to the middle- or upper-income ranks as adults.

The data showed that 80% of Black adults and 86% of Hispanics who followed the entire success sequence reach at least the middle-income bracket, along with 91% of whites. 

Do it all, said Wang, and racial gaps are nonexistent. “That’s the stunning part. It definitely works. And the success sequence does not discriminate based on race or gender or  income growing up,” she said.

But when young adults don’t take any of the steps, nearly three-fourths end up poor.

“The hard part is how do we get young adults to get there. That is the next job,” she said.

What about other disadvantages?

The report says the shares who successfully avoid poverty by following the sequence are similar despite what otherwise are considered disadvantages. That includes 82% of the step-takers who grew up in lower-income families and 84% who grew up without both parents at home. 

The news is particularly good for low-income young adults who can build on the success sequence. After following all three steps, Wang and Wilcox said, 94% of millennials who grew up in the bottom third of the income distribution have left poverty behind by their mid-30s. The story is similar for young adults who grew up without both parents at home. Among those who followed the three steps of the success sequence, just 5% are poor in their 30s.

The poverty gap between those from disadvantaged backgrounds is greatest among those who missed the most steps and narrows as the steps are completed. When young adults who grew up poor skip the success sequence entirely, more than half remain poor — a number that’s just 38% for those young adults who came from middle- and upper-income families.

Family structure matters the least for those who completed all three steps. With each completed step, the gap shrinks.

Wang said she was fascinated to see “gaps were not big at all” between those who completed all three steps and also earned a four-year college degree, compared to those who completed the steps and didn’t graduate college.

Of high school graduates who complete the other two steps, but don’t attend college, just 5% were in poverty later, compared to 1% who had a four-year degree.

“We know college is not for everyone,” Wang said. “And even today the majority do not get a college degree. It’s encouraging to know you don’t have to get a four-year degree” to avoid poverty. 

She also noted that compared with boomers and Gen Xers, millennials are much better educated. Nearly 40% of millennials ages 25 and older have at least a bachelor’s degree; the share among Gen Xers and boomers is under 30%. 

Gender

The report says women are more likely to be in poverty than men. Among millennials age 32-38, 15% of women are in poverty, compared to 12% of men. But the numbers in poverty leap if women stray from the formula’s path.

Among women who didn’t complete any of success sequence steps, 55% experience poverty. For men who skip the sequence entirely, poverty finds only 49%.

Graduating from high school and working full time by their mid-20s can help both genders overcome poverty. Among millennial women who marry before they have a baby, 97% are not poor by their mid-30s.

Teach it, preach it

The report calls for policymakers, educators and others to make the success sequence easier for everyone to follow. Wang and Wilcox would like to see the three steps formally taught to help young adults flourish.

“This will require new public and private policies and initiatives,” they wrote in the report, noting that schools should help students who are not headed toward college develop work-related skills. 

No one’s surprised that working full-time helps people avoid poverty, Wilcox said, but they controlled for work and still found that marrying before having kids greatly reduces the risk of being poor — and makes people twice as likely to reach the middle class or higher.

Families can experience trouble building a financial footing: Breakups or being a single mom struggling to juggle family and full-time work, child support and court costs can all drag on financial well-being. Unstable family life, sharing custody across households — those also have potential to apply a financial brake that make it more difficult, Wilcox said.

Wilcox bristles at the notion that it’s simply the resources provided by two adults who are committed to each other, rather than marriage, that helps a family find solid footing. “That’s like saying that when it comes to education, you could walk down to your local library and assemble an excellent education by reading books. Or writing papers on your own and taking a final exam of your own making. I’m standing right now two blocks from a public library that’s got great holdings. I could certainly try to go and get an education there that would be equivalent to that offered by (the University of Virginia). People could do it theoretically,” he said.

“But in the real world where I live, it’s pretty hard to assemble a decent college education from your local public library. That’s why you need an institution with norms and practices and public recognition that affords you a more structured and acceptable path to higher education. The same thing is true for marriage.”