GenZ and Money: How GenZ Faces Their Financial Fears
People who grew up during the Great Depression have a certain set of stereotypical characteristics that were shaped by the circumstances in which they lived. These are the people who saved every twist tie from a loaf of bread. They even had to wash out the bread bags to reuse them because every resource was precious and needed to be used to the fullest.
In a lot of ways, it is an admirable way to live — waste not, want not, as the saying goes. It’s certainly a lot better for the planet. But over the decades that followed the Great Depression, waste and excess became the norm.
In the post-war era, plastic things got used once and thrown away, the feeling is that there would always be more. The economy grew at a breakneck pace until it stopped and retracted in a major way.
The United States and much of the rest of the world entered The Great Recession and Millennials had the rug pulled right out from under them. GenZ watched as their immediate elders faced rampant unemployment, stagnated wages, skyrocketing college costs, and a ballooning cost of living — all while trying to enter the workforce and pay off the tens of thousands of dollars in student loan debt they were forced to take.
As a result, GenZ has become much more frugal and pragmatic, looking for alternatives to college and career. GenZ has financial fears, but they are facing them head-on.
Saving Takes The Place of Debt
Whereas Boomers and GenXers made massive credit card debt and Millennials made massive student loan debts, GenZers want nothing to do with debt. In fact, they look at college as a means to a career. They are open to alternatives, like community college and trade school, if it will help them secure a job and stay out of debt.
GenZ reports feeling much less comfortable with taking out student loans than Millennials, despite the fact that Millennials save more money than GenZers. About 66% of GenZers plan to attend an in-state school in order to save money and 19% plan to live at home and commute to save even more.
During the Great Recession, GenZers watched their parents’ net worth fall by 45% on average, leading to massive instability in their home lives and their parents’ futures. As a response, they are doing everything they can to ensure stability in their own futures.
They are going after the most stable careers they can think of, even if it is not something that fulfills them personally. They will relocate to another state, work evenings and weekends, take on internships and apprenticeships, and otherwise cede any gains in work/life balance made over previous generations in order to ensure they remain financially stable. They’ll give up all their free time to work side hustles and pick up gig work, if necessary.
- 77% of GenZ is already earning money for these things or an earned allowance
- 35% of GenZ have an entrepreneurial mindset and either own or plan to own their own businesses
- 89% are already planning for their financial future and say it makes them feel empowered
- 64% have begun financial planning research already
A Generation’s Extreme Risk Aversion
Protecting their potential income is the most important thing to this generation. It shows even in the way they interact with social media. Despite the fact they use social media far more often than other generations:
- 87% say keeping posts private is more important than getting shares
- 66% have changed privacy settings to avoid having their information fall into the wrong hands
- 55% believe that what happens online stays online forever, so they would rather be anonymous than vocal in case it could hurt their future careers
- 76% believe people share too much online and don’t want to follow suit
It’s safer to be anonymous online than it is to speak out and GenZ embodies this. They only want to be safe and comfortable. Posting about causes online or sharing personal information is not something they tend to be comfortable with.
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Author: Brian Wallace
Brian Wallace is the Founder and President of NowSourcing, an industry leading infographic design agency based in Louisville, KY and Cincinnati, OH which works with companies that range from startups to Fortune 500s. Brian also runs #LinkedInLocal events nationwide, and hosts the Next Action Podcast. Brian has been named a Google Small Business Advisor for 2016-present and joined the SXSW Advisory Board in 2019.