How do gen z attitudes towards money differ from previous generations?
Having grown up in a recession with unlimited access to the internet, young people today are spending, saving and rewriting the rules on work
When I was younger, my grandma used to tell me: ‘Look after the pennies and the pounds will look after themselves.” As a child, I took this literally, collecting small, bronze coins from the playground and stashing them in a piggy bank until I had enough to buy a sweet or a magazine. But of course, that wasn’t just what my grandma meant. In a way, her use of the expression implied something bigger about her mindset towards money: that if you get a job, spend smartly, and save up, you will be able to rent and then maybe eventually buy a house.
This is because for my grandma’s generation (baby boomers), that was generally true. While there were inequalities in how true this was for different people depending on class, race, gender, etc., it was a more reasonable motto to live by because rent, housing and living prices were relatively proportionate to wages.
Skip forward 70 years, and the picture is entirely different.
For Gen Z, growing up during the deepest recession since World War 2, with house prices outstripping salary increases, the idea that if you get a job, you will be financially stable, doesn’t ring the same as it once did. Instead, we’ve grown up watching millennials struggle to afford a house even though they followed the script that told them they would be able to. This has given us a deep sense of mistrust in the script that we, too, were told to follow. A sense of hopelessness and uncertainty in the future has undoubtedly impacted our perception of money.
Gen Z are particularly savvy when it comes to money, with 69% using some sort of budget to manage their finances, so much so that we have developed our own vocabulary to articulate different budgeting strategies. ‘Soft saving’ denotes putting money away for memorable experiences, such as travelling, as opposed to splurging on short-term enjoyment or saving for retirement. While ‘loud budgeting’ is all about being honest with your thriftiness, not saying “I don’t have enough” but “I don’t want to spend”, as TikTok creator Lukas Battle explains.
Jenna Zaza writes for The Guardian: “More than other generations, a majority of Gen Z splurges intentionally, according to a recent McKinsey report. Many young consumers open dedicated travel or experience funds… and use loyalty programs such as credit card points to lower trip expenses.” She goes on to say that some young people are creating spreadsheets to track their spending and ensure summer will be filled with trips to Mallorca, Phuket and beyond.
As the markers of adulthood are pushed further and further backwards and the prospect of buying a house, having a kid and getting married seems more and more distant, gen z are prioritising experience-led purchases such as travelling, wellness and entertainment, saving up to afford a trip or a new gym membership in ways that previous generations wouldn’t have at the same age. These are the new markers of adulthood.
Meanwhile, with the price of restaurants, clubs, pubs, clothes shops, hairdressers, and football matches more expensive than ever, Gen Z have to spend more cautiously in everyday life, often choosing one or two hobbies that feel the most important to spend money on, and skimping out on the others.
Where access to the internet has made consumerism more accessible than ever before, Gen Z has had to come up with money-saving strategies to limit their spending and watch their purse strings. ‘Doom scrolling’ – another term floating around TikTok – describes the act of indulging in a shopping spree as a form of self-therapy – an experience known to all generations, but perhaps more intimately to a group so accustomed to the act of ‘scrolling’.
However, access to the internet has also made Gen Z more savvy when it comes to making money. We grew up money smart because we grew up tech savvy. Side hustles such as Depop, graphic design, Crypto, social media, and even OnlyFans offer an alternative source of income for young people who see little hope in the pre-ordained path to financial stability. In other words, Gen Z are rewriting the career script and doing things a little differently.
“I think they’ve got a very different attitude towards the value of education,” says Dr Eliza Filby of Gen Z’s decreased interest in academic subjects. “They think about income beyond the wage because millennials have grown up in an era of stagnant wages. Gen Z are like: you cannot live by the wage alone, which is why you’ve seen 40% of Gen Zers invest in the stock market. There’s an incredible entrepreneurial hustle energy in Gen Z because they’re like ‘Yeah, that track doesn’t work, look at Millennials.’”
According to Filby, this realisation happened too late for Millennials – they had already taken the path, followed the script, and are only now starting to clock it didn’t work – while gen z have had the foresight and the tools to make changes earlier, and are foregoing a £30k debt in favour of apprenticeship degrees (which are now harder to get into than Oxbridge).
The job market is also significantly worse for my generation, with about 58% of recent university graduates still looking for full-time work, compared to 25% of earlier graduates, like millennials, Gen Xers, and baby boomers. The number of young people I talk to who have spent months trawling through jobs on LinkedIn, only to find half of them have about 200 applicants within a day of being posted, and 100 of those applicants are at least two entry levels above what is needed. And while Covid-19 can take a fair share of the blame thus far, it’s not looking any more promising as AI comes along.
Is it any wonder then that Gen Z are looking for alternative ways to make money? The rise in influencer culture has made quick success seem like a better and easier option to financial security than more traditional career paths, with programmes like Love Island and platforms like YouTube making this a reality for some.
Gen Z’s financial habits are very much a product of their circumstances as children of the recession and the internet. They have seen that times are changing and are navigating the complexities of modern economics with a new set of rules.
Scene & Heard:
Carnival szn is HERE & the city’s got moves lined up from start to finish. From building sound systems in Dalston to kicking ball with Labrum, dancing under lasers, slow jams, pure vybz & basslines that don’t quit, this is Notting Hill Carnival: The Extended Cut.
building the dance @ gillett square on 18/08 - 22/08 and 26/08 - 28/08
Over 8 days you will be taught how to build a soundsystem collectively. From building the wooden boxes, to house the sound, wire the electrics to then operating the soundsystem, and more!
big dance @ 3 thorpe close on 23/08
Formula Bad x Wray & Nephew are coming together to celebrate 200 years of Uncle Wray in association with No Long Talk. Get ready for the baddest DJs, pure vybz and nuff surprise guests all night long.
pre-carni football tournament @ dunloe street on 23/08
Labrum London are bringing together Waf, Daily Paper and LABRUM FC for a day of sport, food, music and community. Come kick ball or cheer from the sidelines. Open to all!
yearners @ here at outernet on 23/08
SlowJams With A is bringing a pre-carni dance. DJs on the night bringing you the rhythms and vibes. DJ Rivas, JJESS, EllaDHC, DJ Bradshaw & AAA. This space is for city girls, loverboys, toxic feels and treacherous lil twins.
rampage sound @ scala on 24/08
The official Bank Holiday Rave brought to you by Rampage Sound and crew. An all star line up, 8 hours of raving across 4 spaces in the heart of London's Kings Cross.
rinse fm carnival after party @ paradise on 25/08
Bringing the heat to you this Bank Holiday weekend. Stay locked as they’ve got a couple of surprises lined up before. You know it’s going to be a vibe with Havana Club supplying the drinks all night long.
smoove @ ministry of sound on 22/08
Pure fire: UKG, Funky, R&B,Afro-House, Amapiano, Gqom + more, high energy, deep cuts, full-body rhythm from start to finish. Tradition meets now. Sound system pressure guaranteed. Don’t sleep.
lick x pulse @ earth hackney 22/08
The biggest WLW event in Paris on a warm up event for Notting Hill Carnival. As always, LICK will be donating all profits to a Caribbean cause All Roads Community & Development Fund. DJ’s Talia A. Darling, Kailys, 22Heures30, Miller Black and Laura Lee. Strictly no men allowed!
carnival after party @ ministry of sound on 25/08
Carnival’s not over ‘til Ministry say so. 15 DJs, 4 arenas, pure chaos ‘til 6am, bank holiday Monday goes off! Kenny Allstar, Shenin Amara, Jay Knox, Martin 2 Smoove, Andy Purnell, and Bang Bang Carnival Soundsystem to name a few.