Gen Z has seen a multitude of labels across the years: loneliest generation, TikTok generation, and now the least financially educated generation. According to Forbes this generation has the lowest financial literacy rates with just “38% of financial literacy questions answered correctly in recent assessments.” But what if there’s more to this generation’s struggle than a few sweeping labels and statistics?
Rising spending habits, with projections for Gen Z to be the largest and highest-spending generation in history, can be partly attributed to the 1997–2012 generation being the second-largest generation group. This generation enters the workforce at a time of economic stability and record high student debts, making their plight against financial stability more difficult than their predecessors.
Despite these roadblocks, this generation is making their work around by receiving easy-access financial education through platforms like TikTok and Instagram, where social personalities provide advice and tips for financial stability. According to an article by Fidelity Federal, many Gen Zers have reported stock market participation and smart investments that help stay ahead of economic uncertainty. This generation is focused on “saving for retirement, trading on apps and contributing to high-yield savings account as their best easy to build wealth.” Although iced coffees and online shopping may be what these digital natives purchase frequently, Gen Zers have their sights set elsewhere when it comes to generating financial certainty in a time of economic uncertainty.
Generation Z prioritizes peace of mind, well-being, and value-driven spending over frugal and pure accumulation of funds. Many individuals even accept lower incomes in favor of better work life balance. At the same time that this generation sets budgets, they similarly value enjoying a better quality of life according to 73% of participants in a survey. The question is, what can we learn from these high spenders who balance wealth, life, and peace well despite stereotypes?
- Embrace Technology
Although financial education classes are no longer required by many high schools across the U.S., Gen Zers have worked around this by taking digital advantage through financial influencers’ educational content, investment apps like Robinhood, and local banking opportunities such as savings programs and digital banking access. It might be time to see technology as a tool rather than unwelcome change. WV Central offers digital banking opportunities and Gen Z focused literacy programs such as Zogo!
- Stay Aware of Fraud
Fraud is a top concern for many Gen Zers who are accustomed to Internet scams and phishing attempts. Staying aware and on your toes when it comes to warning signs can help protect your finances in the long run. WV Central releases educational content on social media regarding different scams that are on the rise or most likely to be seen by members. Stay posted on our socials for educational content regarding scams to help you stay on top!
- Change Your Perspective
One of the hallmarks of Gen Z’s financial journey is how they have reshaped and redefined the general idea of success. Debt-free living and work life balance are prioritized at the expense of higher paying salaries, which is certainly a trade off many are not used to. Along with financial sacrifices Gen Zers are also likely to shop secondhand rather than purchasing the newest clothing trends. It might be time for a fresh new look at life and finances.