Boomers love to give Gen Z unsolicited financial advice because, in their eyes, the younger generation just doesn’t understand how the financial world works. However, this couldn’t be more false; the younger generation is actually really on top of these things. To show you what we mean, here are 21 ways Gen Z is more financially savvy than boomers.
Digital Banking
As soon as it arrived, Gen Z instantly preferred digital banking over traditional methods, and as UK Finance points out, they’ve ditched physical bank branches completely. Instead, they find apps and online platforms more convenient, making it easier to track expenses and transfer money instantly. This tech-savviness helps them manage their finances better than older generations, who are often reluctant to make the switch.
Investing Early
Gen Z has always known the power of compound interest and has, therefore, started investing young. Meanwhile, boomers often begin investing later in life while relying on old-school legacy investment brokers. In contrast, Gen Z uses consumer platforms for their investments, allowing them to freely build wealth from an early age.
Side Hustles
Rather than relying on just one job, Gen Z is increasingly seeking multiple income streams, diversifying their finances to protect themselves from risk. Freelance work, gig economy jobs, and online businesses are all popular choices; either way, there’s no denying it provides them with greater financial security and opportunities for growth than boomers ever had.
Financial Education
Thanks to the internet, Gen Z has had a competitive advantage when it comes to accessing financial education. They can learn about budgeting, investing, and saving from various platforms, giving them a better understanding of money management than many Boomers had when they were young. Ultimately, this explains the roots of many points on this list.
Budgeting Apps
Using budgeting apps is second nature to Gen Z; these tools help them track their spending, set financial goals, and stick to a budget. This practical approach to money management often contrasts with the more traditional methods used by Boomers, but if they just gave the apps a try, they’d no doubt be converted.
Saving for Experiences
Unlike boomers, Gen Z values experience over material possessions. They save money for travel, concerts, and events rather than buying expensive items, a mindset that allows them to enjoy life while still being financially responsible.
Minimalism
Nowadays, minimalism is becoming a very popular lifestyle among Gen Z, helping them save space, maintain mental clarity, and, most importantly, save money. They prioritize quality over quantity, purchasing fewer but better items. This approach reduces clutter and unnecessary spending, which differs from the more consumer-driven habits of many Boomers.
Debt Aversion
Gen Z is very cautious about taking on debt because they’ve seen how it has turned millennials’ and boomers’ lives upside down. They much prefer to avoid credit cards and loans unless absolutely necessary, and this careful approach helps them maintain financial stability.
Using Social Media for Financial Tips
As we briefly mentioned earlier, it has never been easier to get financial education online, and social media plays an important role in this. Gen Z follows influencers and financial experts who share money-saving tips and investment advice, giving them easily accessible information to help them make smarter financial decisions. Sadly, boomers just never had such tools, with financial advice coming at a high price.
Eco-friendly Spending
Another way Gen Z is more financially savvy than boomers is by being more conscious of the environmental impact of their spending. They support eco-friendly brands and products, often choosing sustainability over cost. Ultimately, this may cost more money in the short term, but the products are usually of higher quality, saving them money in the long term.
Freelance Economy
The freelance economy appeals to Gen Z greatly, as they appreciate the flexibility and potential for higher earnings that it offers. This independence allows them to control their financial future more effectively than traditional employment might, something that boomers might complain about but, in reality, are simply jealous of.
Avoiding Big Purchases
Gen Z tends to avoid big-ticket purchases like houses and cars, preferring renting and using ride-sharing services, which reduces financial burden and provides more flexibility. This contrasts with the asset-focused mindset of many Boomers, which is often used to measure success.
Emergency Funds
Boomers are no strangers to emergency funds, but most didn’t even consider this until their middle age. Meanwhile, building an emergency fund has always been a priority for Gen Z. They understand the importance of having a financial cushion for unexpected expenses, helping them stay prepared for financial challenges.
Health and Wellness Spending
It’s quite common for boomers to criticize Gen Z for spending money on their health and wellness, but this is actually a very smart investment. By spending on fitness, healthy eating, and mental health resources, Gen Z is protecting its health in the long term, preventing it from having to spend big in the future on private healthcare.
Online Marketplaces
These days, Gen Z almost exclusively uses online marketplaces to buy and sell items, save money, and earn extra cash in the process. Platforms like eBay, Vinted, Gumtree, and Facebook Marketplace are all popular for finding deals and decluttering. Thankfully, boomers are finally starting to cotton on to this.
Tech-savvy Shopping
Using technology for smart shopping is a common practice among Gen Z. They compare prices online, use discount codes, and read reviews before making any purchases. This informed approach helps them save money, something that boomers should really learn from instead of mocking.
Transparency in Finances
In general, Gen Z values transparency and honesty more than boomers, and this includes when it comes to financial dealings. They expect clear information from financial institutions and avoid hidden fees, demanding openness and thus leading to better financial decisions.
Learning from Mistakes
It’s a sad fact that Boomers often feel mistakes are failures that should be avoided, whereas Gen Z sees them as valuable learning opportunities. However, interestingly, they tend to learn from the mistakes of others through the internet, using online forums and advice from older generations to avoid common financial traps.
Crowdfunding and Peer Lending
Back in the boomers’ days, raising capital would involve approaching big-time investors and investment firms, which was an expensive, lengthy, and confusing process. However, Gen Z is now just using crowdfunding and peer lending platforms, using these alternatives to raise cash with more flexible terms and benefits.
Prioritizing Mental Health
As we briefly mentioned earlier, Gen Z recognizes the link between health and financial well-being, and this doesn’t just concern physical health. They invest in mental health resources such as therapy, self-help books, and courses, all of which help them prevent problems in the future and avoid spending big on long-term therapy, medicine, and treatment.
Collaborative Consumption
Above all, you’ve probably noticed how Gen Z embraces the sharing economy, participating in services like car-sharing, co-working spaces, and tool libraries. This collaborative approach saves money and fosters a sense of community, setting them apart from the more ownership-focused boomers in an undeniably positive way.