Millennial millionaires are delaying home, car purchases due to

Millennial millionaires are temporarily shelving major purchases as interest rates and inflation rise, according to CNBC’s Millionaire Survey.

Nearly half of millennial millionaires say higher borrowing costs are causing them to delay buying a car, and 44% say higher interest rates have caused them to delay purchasing a home, according to the survey. More than a third said inflation has caused them to delay a trip or vacation.

The CNBC Millionaire survey, which surveys those with investible assets of $1 million or more, suggests that inflation and rising borrowing costs are working their way up the wealth ladder. While inflation hits the middle-class and lower-income groups hardest, rising interest rates are starting to squeeze more affluent, younger consumers, especially for big-ticket items.

Millennials are three times more likely to be cutting back on big purchases compared with their baby boomer counterparts, according to the survey.

“The millennial millionaires are clearly dealing with something they’ve never experienced,” said George Walper, president of Spectrem Group, which conducts the survey with CNBC. “As a result, they are changing their behaviors and spending plans.”

Spectrem Group and the survey consider respondents born in 1982 or later, those currently aged 40 and younger, to be millennials. Respondents born between 1948 and 1965, aged 57 to 75, were considered baby boomers.

Inflation and rising rates have created two separate but related spending constraints for affluent consumers.

Inflation has driven up the prices of luxuries such as dining out, plane tickets, hotels and even certain monthly subscriptions. According to the survey, 39% of millennial millionaires have cut back on dining out because of higher inflation. Thirty-six percent have cut back on vacations, and 22% have cut down on driving.

At the same time, the Federal Reserve’s interest rate hikes have jacked up the cost to borrowing, especially for homes and cars. The central bank on Wednesday raised its benchmark rate to a range of 1.5%-1.75% and said another hike could come in July.

Two-thirds of millennial millionaires surveyed said they are “less likely than a year ago to borrow money” due to higher interest rates. That compares with only 40% for baby boomers.

Forty-four percent of millennial respondents said higher rates have caused them to delay purchasing a new home, compared with only 6% of baby boomers. Nearly half of millennial millionaires said they are delaying purchase of a car because of higher rates — more than double the rate of baby boomers.

Millennials are typically key drivers of sales growth for both homes and cars.

“Millennials, like everyone else, are seeing that the mortgages they were looking at in January are now more than twice as much,” Walper said.

CNBC’s Millionaire Survey was conducted in May, before the Fed’s latest rate hike. It surveyed approximately 750 respondents who reported that they are the financial decision-makers or share jointly in…