All Posts

When it comes to money, we should all act more like Gen Z

Picture a woman. She is wary of credit cards, and saves up her money for big purchases. When she does make a purchase, she is focused on value; some might even call her frugal. On the whole, she is skeptical of banks, and when she does bank, she strongly prefers a bank with physical locations.

No, I’m not talking about your grandma. I’m talking about the young, smartphone-toting college student next door.

Gen Zs are surprisingly conservative when it come to money. They watched their parents struggle their way through the Great Recession of 2008, so they are practical when it comes to the economy, debt, and their future success. In fact, a UNiDAYS survey of over 1,800 Gen Z students makes it clear that growing up during a global financial crisis has had a major impact on how Gen Zers view money.

Josh Rathour, CEO and Co-Founder of UNiDAYS, walked through the survey results at the Money 20/20 conference in Las Vegas. Here’s what we learned:

Gen Z chooses side hustles over serious debt

While the majority of millennials embrace debt as a part of life, Gen Z is more mindful of it. With 26 percent of Gen Z college students surveyed expecting to graduate with no debt at all and an additional 26 percent expecting to graduate with less than $25,000 in debt, it’s clear that Gen Z has learned from the millennial generation’s debt-filled pitfalls.

Students today are even willing to put in work in order to avoid debt. In fact, 73 percent of undergrad students have a job or side hustle in order to help pay for their education and expenses. Not only are Gen Zers avoiding loans, but they’re also choosing majors that will yield practical, generously-paying jobs, as opposed to the “follow your passion” millennial generation.

Gen Zers are careful when it comes to credit

Gen Z’s conservative ways continue when it comes to consumer credit. For big purchases, 83 percent of Gen Zers surveyed said they save up rather than using credit. In fact, over half of them don’t even have a credit card. Of those, 61 percent plan to apply for one, but the vast majority will apply mainly to establish a credit score.  In this way, they are also very different from their millennial predecessors.

Mom and dad have sway over Zs’ financial decisions

The notion of defiant, rebellious teens falls flat when it comes to student finances. Although  as we noted, many of them don’t have a credit card, 72 percent do have a savings or checking account. So how did they decide which bank to open an account with?  61 percent went with their parents’ bank.

And once Zs have chosen a bank, it’s not the easiest task to get them to switch. Of Gen Zers who have a bank account, 54 percent don’t plan to open another account no matter the incentive. This speaks to the influence parents have over their offspring, as well as the stickiness of those early financial decisions.

Gen Z is mobile-first, but not mobile-only

When it comes to accessing their accounts online, students clearly prefer their smartphones over other devices.  But surprisingly, 45 percent of “digital native” Gen Zers would not consider banking with FinTechs that are online only, as they prefer banks that also have physical locations.  We won’t go as far to say Gen Zers aren’t open to non-traditional ways of banking, but clearly, the jury is still out on Fintechs.

Gen Z cares whether or not you care

Perhaps most importantly, Zs are very concerned about business integrity. 93 percent say it’s important to them to bank with ethical companies that give back. To emphasize this point, given a choice between two companies, 86 percent would choose the one that’s more ethical, even if the incentive is lower. One of the biggest keys to winning Gen Zs is clearly winning their trust.

We can all learn from Gen Z when it comes to money

Gen Zs are more conservative when it comes to their money than one might assume. Growing up with the financial crisis in their rearview mirror and internet at their fingertips, Gen Z are both cautious with finances and pros at finding deals. They understand value and are want to get the most out of their money. We could all learn a thing or two from Gen Z when it comes to money and how to save it.

Interested in understanding what else is motivating Gen Z’s financial decisions? Download our white paper: “Gen Z and Money: What you need to know”.

Download the report

Jacqi Levy
Jacqi Levy
Senior Manager, B2B Content Strategy @ UNiDAYS

Related Posts

How brick-and-mortar gyms can compete against in-app fitness

Gen Z health and fitness marketers of the world, meet Kayla Itsines. The 27-year-old fitness instructor and self-made millionaire from Adelaide, Australia has turned herself into one of the most-recognized fitness influencers on Earth. Analysts forecast that her fitness app, “Sweat: Kayla Itsines Fitness,” will garner around $77 million in revenue in 2018 alone. Her 8.9 million Instagram followers include the likes of well-known supermodels and gold-medal Olympic swimmers. Itsines is just one of a crop of up-and-coming fitness influencers who’ve become social media superstars — and whose popular workout routines pose a challenge to long-established, brick-and-mortar fitness brands. For more established companies in the wellness industry, this is the kind of thing that should make you stand up and pay attention.

Gen Z goes to Washington: Today a new generation turns out to vote

Elections aren’t just showdowns between opposing political views. They’re also just as much about the push and pull between generations and their visions of what’s best for a country, state, district or city. The 2016 election showed the deeply contrasted political visions and values of Baby Boomers versus Millennials, the two generations that showed up that year to vote in make-or-break numbers. In contrast, Gen Z weighed in at merely six million eligible voters in 2016, and had little chance of tipping the political scales in either direction.

Gen Z: Black Friday is back, and so is Thanksgiving dinner

With each coming generation, media pundits like to obsess over all the industries, hobbies and passions that are bound to be “killed off”. Gen X was accused of killing the radio business, for example, and Millennials are still regularly accused of “destroying marriage”. Now it’s Gen Z’s turn in the barrel. Over the last few years, Gen Zers have been charged with killing off everything from in-store shopping to television to football. And while it’s pretty clear how (and why) all these things can — and will! — survive Gen Z, the same can’t be said for everything. Take Black Friday for instance. Is there a future for it under Gen Z’s watch, or will it go the way of the compact disc?