Generation Z is facing significant economic disillusionment, with nearly half (49%) feeling that future planning is “pointless,” according to a Credit Karma survey. This sentiment stems from pervasive financial “despair” and a carefree spending attitude, often leading to high-interest debt. Experts warn that such behavior can impede essential life milestones, including moving out or saving for retirement. Despite being in a prime age to cultivate healthy financial habits, many Gen Z members feel disillusioned due to the challenging job market, especially with unemployment rates for recent grads significantly higher than the overall rate.
Debt is another pressing concern, as about 50% of 2022-23 college graduates emerged with an average student debt of $29,300. The federal government’s recent resumption of student debt collections adds to this anxiety, particularly after thwarted expectations for widespread debt forgiveness. Compounding these issues, a New York Fed report indicates rising credit card delinquency rates among Gen Z, with 15% maxed out on their cards, partly driven by the attraction of “buy now, pay later” services.
To counteract this financial malaise, experts encourage young adults to shift their mindset. By recognizing their current low expenses as an opportunity, they should invest—however small, like $10 monthly—in tax-advantaged accounts to benefit from compound growth over time. Investing through employer-sponsored plans is highlighted as an accessible starting point. Ultimately, rewiring financial perceptions can empower Gen Z to navigate their economic challenges and build a more secure future.
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