Where does Gen Z invest their money?
Individual stocks and retirement investing accounts are the most common types of investments among Gen Z and millennials. The most common types of investments owned across all generations are retirement investing accounts and individual stocks.
46% of Gen Z spent more on fashion than anything else in 2022 (5WPR) Gen Z was the only generation to have clothing and fashion as their top spending category. 30% of Gen Z spent more on beauty and personal care than anything else, far more than any other generation.
More than one-in-10 (13%) Gen Zers currently earn income through social media, including content creation (53%), TikTok Shop (41%) and brand deals (33%). Of those who earn income through social media, more than a quarter do so as a full time job (26%) and more than half (56%) do so in addition to their full time job.
According to Bank of America, 85% of those identifying as Gen Z see one or more barriers to financial success. Cost of living expenses tops the list, noted by 53% of respondents. Addressing the cost of living crisis is important to Gen Z's financial well-being.
Gen Z spending habits show they care the most about fashion, makeup and beauty products, technology, and their pets. This is perhaps due to their young age and few major bills.
According to a 2021 Consumer Culture Report by 5WPR, Gen Z is prioritizing electronics, technology, health, and wellness. Conversely, Millennials and those from older generations prioritize travel and experiences, home goods, and furniture.
Gen Z's Financial Reality is an Everyday Struggle
According to research from ConsumerAffairs Research Team (2023): Workers in their twenties today have 86% less purchasing power than baby boomers did at the same age.
Millennials were somewhat better off than Gen X—those born between 1965 and 1980—when they were the same age. Zoomers, however, are much better off than millennials were at the same age. The typical 25-year-old Gen Z-er has an annual household income of over $40,000, more than 50% above baby-boomers at the same age.
The share of zoomers living in poverty reached a peak of 23% in 2011 and 2012, then steadily fell to 17% — about 11. 3 million young people — by 2021. Poverty rates for Gen Alpha have been the highest of all generations, starting at 25% in 2013 and dipping to 18% (about 6. 1 million kids) in 2021.
Gen Z has several things working against them besides just the state of the economy, housing market, and education system they were born into. They are dealing with a never-before-seen market that relies on instant, digital payments and may fuel impulsive spending.
How much debt is the average Gen Z in?
The youngest Credit Karma members, those of Generation Z, carry the least total debt on average — $16,283 — followed by members ages 78 to 95, the Silent Generation.
Gen-Z feels substantial anxiety and stress about jobs, long-term financial stability and major life steps, such as buying a home and starting a family.
Millennials could stand to inherit trillions worth of property and property assets passed down by ancestors in the next 20 years. Millennials could potentially become the wealthiest generation ever, according to estate agent Knight Frank's 2024 Wealth Report.
Young people, like people of all ages, enjoy burgers, pizza, chicken, sandwiches, salad and fruit. And the younger they are, the more simple they like it, according to restaurant-hospitality.com. From middle school and beyond, their tastes broaden to include more flavours, combinations, and global variety.
The news: Nike, Forever 21, Lululemon, Urban Outfitters, and Sephora are some retailers that Gen Zers prefer visiting in person to shop at, owing to their use of social media in interesting ways, a study by MG2 and Berns Communications Group found.
More than ever, younger generations are spending their savings on luxury goods, Bloomberg reported on Wednesday. Known as “doom spending,” the act is practiced by some 43 percent of millennials and 35 percent of Gen Z, according to data from the personal finance company Credit Karma.
Gen Z tends to spend more on high-quality snacks and beverages, raising the price on their grocery bills. One 23-year-old Gen Zer told Business Insider that “he spends about $130 on groceries for a week and a half. 'Fancy sodas and drinks' and 'random snacks at Trader Joe's' account for the bulk of the bill.
Gen Z — the post-Millenial generation, born roughly between 1997-2012 — are mostly in their teens, but the oldest among them is already 22 and by 2025, they'll account for 27% of the workforce. The study shows that for workers ages 18 to 25, the median they have saved — across retirement accounts — is $33,000.
“Although getting a job is their top concern - when compared to Gen Z boys, Gen Z girls are less concerned about securing a job and being successful, showing more concern over mental health, confidence and body image.”
Despite Increasing Salaries, Gen Z and Millennials Can't Afford Houses. “This is a resilient response to the very dramatic increase in rental burden. The average proportion of a person's income that goes to rent was 25% in 2000, and it's now 40%. That's really a striking increase,” Wachter said.
Will Gen Z never retire?
Generation Z faces an uncertain financial world, and they're well aware they likely won't have the same benefits as generations that preceded them. Roughly one quarter (23%) of Gen Z don't expect to ever be able to retire, according to a recent McKinsey & Company study.
Instead, they're grappling with alarming rates of loneliness, depression and suicidal thoughts. Zoom in: Partly by choice and partly out of necessity during the pandemic, Gen Z socializes online, rather than in person, far more than previous generations. That's not healthy, experts say.
Rich Gen Zers are convinced they're going to get even wealthier in 2024—but they're likely relying on the bank of Mom and Dad. Much like millennials, ultrawealthy Gen Zers are probably upbeat about their financial prospects because they're being bankrolled by their wealthy parents.
Gen Z are primarily the children of Generation X. Their Generation X parents raised Gen Z to be independent and able to figure things out for themselves.
Younger American (millennial and Gen Z) families represented 33.1% of households and owned 9.3% of total family wealth (72% less wealth) in 2023. The baby boomers' shortfall was the smallest of the generations. SOURCES: Distributional Financial Accounts and Institute for Economic Equity calculations.
