Move over Millennials, Generation Z is changing and carving out a new landscape of personal finance and money for everyone else. Learning from the challenges and tribulations of generations that came before, Gen Z is tackling subjects like student debt, investing, and real estate in different ways.
This new generation of teens and young adults is setting unique standards in an ever-changing world and economy to ensure that they can set themselves up for financial success
“When we look back on generations, we can usually pick out their ‘defining moments’ — events that shaped them and turned them into who they are today. We’re living through one of these events right now. Every person from every generation has been affected by COVID-19, but in this content package, we’ve been able to explore specifically how it’s impacting teens and young adults. It’s important to learn from the generations that came before you, but no one can look back and tell Gen Z how to come of age during a pandemic. It’s important to create content for this specific generation as they begin to learn and apply personal finance in their everyday lives,” said Levi Leidy, Jr. writer/editor at GOBankingRates in a news release. “They could be starting their first job, budgeting as a student, or launching a career — but money matters, and how you first build that relationship with money can impact you for the rest of your life.”
New Survey Says
According to a new survey by GOBankingRates, approximately a third of Gen Z aged 18 to 24, don’t have any kind of debt, and with three-fourths of that generation having less than $10,000 in debt, including student loans. A staggering difference compared to the generations before them like Generation X, those born between 1965 and 1980, who lead for the generation with the largest debt. 19.3% of Gen X respondents say they are $60,000 or more in debt and more than 56.01% have at least $10,000 or more in debt, according to a news release.
Some experts say that Gen Z has seen the effects of financial crashes on their parents and grandparents thus traumatizing them and making them warier of financial burden. Another reason so many Gen Z’ers have fewer worries of debt is that fewer of them are taking on the kind of massive student loan debt that crushed the Millennial generation. Specialized training online or vocational training is proving the way to go for Gen Z over the traditional college path. “Every generation has a unique relationship with money,” said Don Sena, VP of content at GOBankingRates in the news release. “We wanted to explore how and why this generation’s attitudes toward personal finances and investing differ from past generations, while also offering information and advice to help Generation Z make smart financial decisions.”
Another interest of Generation Z that has become increasingly of notice is investing. Thanks to apps and social media, Gen Z can access the stock market more easily than any previous generation. A GOBankingRates survey revealed that 19% say they invest in real estate while an additional 17% dabble in cryptocurrency. Gen Z seems to view crypto as less risky compared to stocks and options that previous generations liked to invest in. The survey also notes that 22.4% of them invest in stocks; 19% in real estate 16.7% in a 401(k) or IRA; 12.5% in a mutual fund or ETFs, the news release added.
While increasing their financial stability is of extreme importance due to the uncertainty of the current world, Gen Z is prioritizing other aspects now more than ever instead of focusing on a higher salary. According to another GOBankingRates survey, perks like working from home and flexible vacation time are a top priority for 41% of Gen Z workers. “Just as millennials are hitting their 40s, Gen Z is rapidly aging into adulthood — it’s estimated that by 2025, they’ll make up about 27% of the global workforce. And with growing emphasis placed on tech and social media in professional spaces, Gen Z will have an enormous influence,” Leidy said.