When it comes to money, Gen Z adults (aged 18 to 24) have distinct traits that set them apart from the general population. CivicScience data suggest that Gen Z is a generation of young adults who are more engaged with and concerned about finances than expected. Here are just a few leading insights about Gen Z’s outlook on money, personal finances, and wealth.
1. Most don’t believe they’ll be wealthier than their parents.
By the end of their careers, just 29% of Gen Z adults think they will be better off financially than their parents, while one-quarter are doubtful and a much larger percentage (45%) are uncertain. Those numbers have shifted since Q4 of 2021, when closer to one-third believed they would be better off than their parents by retirement. It’s likely inflation and declining personal wealth over the last year have negatively impacted future financial outlook among young adults.
2. More than three-in-four have made investments.
A surprisingly high number of Gen Z adults (78%) say they currently have investments. Savings accounts are the most popular (and lowest-stakes) type of investment, followed by retirement funds and mutual funds. Interestingly, 15% say they are invested in cryptocurrency and/or NFTs.
3. Interest in using financial advisors is high among Gen Z.
Given that the majority already have some type of investment, it makes sense that this generation would have a strong interest in working with a financial advisor. Eighteen percent say they currently use a financial advisor, but altogether a surprisingly high percentage (42%) say they have experience with a financial advisor. One-in-three – or the majority of those without any experience – hope to work with one in the future. This ratio far exceeds that of the Gen Pop.
When asked, more than one-quarter cited cost of service as the main reason they don’t use a financial advisor. The other top reason was that they don’t believe financial advisors are trustworthy.
4. Many feel positive about managing their money.
More than 40% of Gen Z adults feel that they manage their money well. That’s more than those who feel neutral, and nearly twice the percentage of those who feel they manage their money badly.
5. Where does Gen Z turn for financial advice?
Soliciting advice from friends and family is the most popular way to seek out financial guidance. That’s not surprising given the young age range, many of whom may still be living at home. However, a high percentage say they turn first to their banks or a financial institution when in need of advice, followed by a financial advisor.
It’s also worth noting that a solid 10% of Gen Z adults turn first to social media sites for advice, more so than other kinds of online resources or books and publications.
Overall, the survey results suggest that Gen Z is a generation proactive about money and finances and unafraid to make investments and seek out advice. They are also realistic when it comes to accumulating wealth, as many don’t feel they will end up becoming wealthier than their parents.
Check back later this month to learn how Gen Z compares to Millennials when it comes to money and finances.