New research shows Gen Zs are feeling financially stressed, with high levels of debt including Buy Now Pay Later use.
New nationwide research released by ASIC’s Moneysmart program today shows for seven in ten (68%) Gen Zs, finances are a major cause of concern, more than any other age group (57% of non-Gen Zs).
Faced with rising cost of living, 82% of Aussie Gen Zs, representing Aussies aged 18 to 26 years old, feel financially stressed, but are twice as likely as other generations to want to better manage their finances as a response.
Encouragingly, nine in ten Gen Zs have a strong desire and intent to boost their money skills and financial confidence, despite facing several barriers. Almost half (49%) of Gen Zs who aren’t financially confident say feeling overwhelmed is the biggest barrier to becoming more confident with money, followed closely by not knowing where to start (42%).
The research also revealed Gen Zs want to learn things in the shortest time possible (77%) and are twice as likely as other generations to turn to social media for information and guidance about managing their finances (56% compared to 23% of non-Gen Zs).
ASIC’s Moneysmart helps Gen Z build money knowledge, fast
Moneysmart is launching a new consumer awareness campaign aiming to show Gen Z just how quickly they can learn money basics and build positive financial habits. Informed by and building on the research, the new campaign shows that in the same time it takes to complete short, everyday tasks, action can also be taken to make a budget, set a savings goal, pay off debt, manage a casual income and manage rising costs.
Commenting on the consumer awareness campaign, ASIC Chief Executive Officer, Warren Day, said “Gen Zs are driven to learn more and improve their finances but there’s a clear need to engage and help them feel more confident about money. We want to show them that it doesn’t take a lot of time to make a start with small steps that will make big differences long term.
“We’re encouraging Gen Zs to use the free tools at moneysmart.gov.au as a starting point to be more in control of their money. There’s a real reason why Moneysmart has long been one of the highest rated financial sites in the nation, and we hope this campaign drives more people to benefit from its resources.
“Learning how to plan and save, and deal with their expenses, sets up young Aussies for their future. We hope this campaign, through its practical tips, will help people feel more in control of their financial lives.”
Financial position of Gen Zs worse than other generations
Research also reveals that on average, Gen Zs have higher levels of personal debt and greater reliance on credit products than other generations.
Key findings include:
- Gen Zs have an average personal debt of $8,188 compared to non-Gen Zs ($6,730).
- One in five (21%, or the equivalent of 600,000) have $10,000 or more in personal debt, including 4% (or the equivalent of 124,000) who have $50,000 or more.
- One in four (25%, or the equivalent of 720,000) have less than $1,000 in savings, including 8% (or the equivalent of 217,000) who have no savings.
- Gen Zs are also more likely than non-Gen Zs to use Buy Now Pay Later (BNPL) products (28% compared to 21% of non-Gen Zs).
- BNPL use is also higher in regional Australia, where one in three (34%) Gen Zs use BNPL products compared to one in four (26%) in metro areas.
In response to cost-of-living pressures, Gen Zs are also considering getting a new or additional job (39%).
The campaign will be rolled out on Moneysmart channels from today until mid-December, with the hope of reducing financial pressure during the festive season.
Background
ASIC’s Moneysmart program helps Australian investors and consumers by providing free and independent financial information and tools. Almost 10 million Australians visit the Moneysmart website each year. Moneysmart is recognised as a trusted source of independent information for consumers and investors.
Research methodology
ASIC via YouGov surveyed 1,016 Australians aged 18 to 26 years (Gen Z) and 1,121 Australians aged 27 and older from 5 to 18 October 2023 to understand their financial attitudes and behaviours. The surveys were carried out online. The figures for each survey have been weighted and are representative of their respective cohort.
Downloads
Key research findings relating to Gen Z (PDF 128 KB)
FAQs
Yet, they're optimistic for the future. More than 6 in 10 Gen Zers say they are hopeful about their financial future and a majority think they'll do better financially than their parents. That's because many are already saving — and investing.
What is the Gen Z in Australia? ›
At particular risk of underemployment are those entering the workforce as young adults – Gen Z (those born between 1997 and 2012). Historically, the youngest members of the workforce are not only paid the lowest wages, but also enjoy less job security in an increasingly casualised workforce.
What makes Generation Z so different from older generations? ›
So what makes Generation Z so different? Older generations may have feared that technology would create an increasingly selfish and isolationist society. Yet as the world opens up and we are more connected than ever, we are witnessing an evolution in empathy and social consciousness amongst this younger generation.
Are Gen Z spending more money? ›
While both generations came of age in the midst of an economic upheaval, Gen Z is spending more on necessities than millennials did at the same age, according to a Washington Post analysis of Bureau of Labor Statistics data. While millennials are between 28 and 43, Gen Z generally refers to those ages 12 to 27.
Which generation is most financially responsible? ›
Millennials Save More than Any Other Generation
In fact, they are saving around one-third more than Gen X every month. The average savings per month by generation are as follows: Millennials save the most on average every month at $535.50.
What is Gen Z looking for in a financial institution? ›
Gen Z wants this easy and seamless access to banking and payments services because they are active consumers of banking and payments products — five on average, according to the research. And they'd use twice as many, if offered and available. So, therein lies the rub.
Where does Gen Z live in Australia? ›
Gen-Z: The students
Canberra's Acton and Duntroon now have the highest proportion of resident Gen Z population at 89% and 72% respectively, likely due to the Defence Academies in the area. This is followed by Brisbane's St Lucia at 47% and Melbourne's Clayton (North) – Notting Hill at 46%.
What generation are you in Australia? ›
Distribution of Australian population in Australia as of 2021, by generation
| Characteristic | Share of population |
|---|
| Gen Alpha (0-9 years) | 12% |
| Gen Z (10-24 years) | 18.2% |
| Millennials (25-39 years) | 21.5% |
| Gen X (40-54 years) | 19.3% |
2 more rowsApr 3, 2024
Other news outlets occasionally use 1995 as the starting birth year of Generation Z. As do various management and consulting firms. The Australian Bureau of Statistics have used 1996 to 2010 to define Generation Z in a 2021 Census report.
Why are people saying Gen Z looks old? ›
Many of the theories online veer into the conspiratorial: One woman suggested that Gen Z looks older because the quality of food is getting worse, which results in faster wrinkles; another claimed that it's because food is getting better, and because millennials ate food with more preservatives in it than Gen Z, ...
And they're the “most” generation in history: most racially and ethnically diverse, most educated, most digitally savvy, and most global by dint of being weaned on the internet.
Is Gen Z financially stable? ›
Bankrate surveys paint a clear picture: A significant portion, 37 percent, of Gen Z respondents reported their finances have improved since 2020, and a whopping 58 percent believe their situation will get even better in 2024, according to a recent Bankrate poll.
What is Gen Z's attitude toward money? ›
Despite being young, Gen Z has exhibited a surprising level of financial prudence. Growing up during the financial crisis of 2008 and coming of age in the tumultuous economic climate following the COVID-19 pandemic, this generation has adopted a cautious approach to spending and saving.
What does Gen Z love the most? ›
Gen Zers are more likely to cite streaming video, streaming music, and playing video games as daily activities compared with the general adult population, per a May 2023 Morning Consult survey. They're also less interested in traditional TV and listening to the radio.
How does Gen Z feel about banks? ›
Gen Zers, defined as those born between 1997 and 2012, have grown up in a digital world, but there's much about traditional banks they like. The level of trust Gen Zers have that banks will safeguard their data, for example, is far greater than the confidence they place in big tech.
What percent of Gen Z is financially literate? ›
Financial literacy is the ability to understand and use financial concepts, including topics like budgeting, saving, investing, and credit. According to a Financial Industry Regulatory Authority (FINRA) survey, only 24% of Gen Z respondents could correctly answer four out of five financial literacy questions.
What is Gen Z struggling with the most? ›
Gen Z Struggles With Mental Health
According to McKinsey, over half (55%) of Gen Zers report having either been diagnosed or receiving treatment for a mental health condition, compared to 31% of people aged 55 to 64, who have had decades longer to seek and get treatment.
Are Gen Z pragmatic and financially minded? ›
Generation Z is notably pragmatic and financially-minded, shaped by witnessing the impacts of the 2008 financial crisis during their formative years. This experience has instilled in them a cautious approach to money management and a keen awareness of economic volatility.
