How Gen Z Manage Their Finances
Like every other generation, Gen Z characteristics, worldviews, and values have been affected by the cultural, social, and economic circumstances they were raised in.
Generation Z is acutely aware of financial realities, which is unsurprising given they grew up after the 2008 recession and during the COVID-19 pandemic.
Gen Z’s approach to finances reflects a blend of caution, innovation, and a redefinition of traditional money norms. Here’s an overview of how they handle their finances:
Experimentation with high-risk, high-reward assets
While cautious in many aspects of life, Gen Z is surprisingly open to high-risk, high-reward investments.
If there’s one asset class that Gen Z is driving, it’s cryptocurrency. Gen Z are more likely that any other generation to buy Bitcoin to make high profits and take advantage of crypto benefits.
Cryptocurrency is a digital currency powered by blockchain technology, whereby transactions are verified and records maintained by a decentralised system.
Equally, non-fungible tokens (NFTs) appeal to Gen Z’s digital-first mindset, combining investment potential with cultural and creative expression.
Caveat: While adventurous, many Gen Z investors admit they need more education on the risks associated with these volatile investments.
Earlier interest in investing
Gen Z often learns about personal finance through online platforms like YouTube, TikTok, and financial apps.
They’re highly self-educated when it comes to budgeting, saving, and investing.
Platforms like Robinhood and Acorns have made investing accessible, and Gen Z is jumping in earlier than previous generations.
Starting early allows Gen Z to take advantage of compound interest, setting themselves up for greater financial security in the future.
More focused on socially responsible investing
Gen Z is deeply committed to aligning their investments with their values. They are drawn to:
Investments that prioritise sustainability and ethical practices:
✔️ Companies focusing on clean energy and sustainability are particularly appealing.
✔️ Brands that champion diversity, equity, and inclusion are top picks for value-driven investors.
This generational shift is encouraging companies to adopt more transparent and sustainable practices to attract young investors.
Preference for DIY investing
Unlike older generations who relied on financial advisors, Gen Z prefers to take a do-it-yourself (DIY) approach.
They use online resources and tools to educate themselves, often spending hours watching tutorials, reading blog posts, or participating in online forums.
✔️ Robinhood for stock trading
✔️ Vanguard and Fidelity for long-term index fund investments
✔️ Coinbase for crypto trading
This hands-on approach empowers Gen Z to feel in control of their financial future.
Gen Z spending habits
Gen Z is more likely to save money and be financially cautious.
They are price-conscious shoppers, influenced by deals, quality, and value for money.
The current inflation and rising living costs play a significant role in reinforcing these concerns.
Generation Z are price-conscious consumers. They spend less generally.
40% of Gen Z households are in the low-income bracket – and 25% more likely to be so than the average consumer (Global Web Index).
Because of this, they prioritise value and affordability when purchasing online, making sales and discounts particularly appealing.
However, they are willing to pay extra for convenience and good customer service. 58% of Generation Z is willing to pay more than $5 for one-hour delivery.
Generation Z buys to express not to impress
Gen Z is an informed and analytical consumer. They assess and evaluate a broad range of information before purchases.
This is because they consider their purchasing decisions an expression of their values and identity—as opposed, for example, to buying or wearing brands to fit in with the norms of groups.
They are drawn to sustainable products and brands that share their values.
The bottom line
Gen Z’s investment habits are a mix of caution and boldness, values-driven decision-making, and a tech-first approach. Their influence is already reshaping the financial landscape, pushing companies, platforms, and markets to adapt to their needs and preferences.
As this generation grows older and their portfolios mature, we can expect them to drive even greater shifts in global markets, demanding more transparency, innovation, and sustainability. For now, they’re proving that investing isn’t just about growing wealth—it’s about creating a future that aligns with their vision of the world.
