Machela Moorcroft Jul 5, 2021 9:12:00 AM 12 min read

Gen Z getting serious about Finance

At what age did you start thinking about your personal finance?

A conversation with my 18-year-old brother about financial investment led me to really think about how different generations think about money.

I’m not sure about you, but when I was 18 my only concern was where I was going out with my mates that weekend or booking my next trip abroad. Not once did I give any thought to investing my money.

After I’d gotten over the shock that my baby brother was talking to me about investing, I asked him why he felt he needed to invest now? His answer, “if I don’t think about it now what kind of future will I have, everyone needs a side hustle these days.”

This new side hustle TikTok craze really took off during lockdown and I was surprised to learn a study done by the Open university found that most Gen Z’s already have, or would consider a ‘side-hustle’ venture, using creative websites, blogs, e-commerce platforms, and social media (such as eBay [81%], Facebook [76%], Instagram [71%], Amazon [59%], and Gumtree [59%]).

Why isn’t personal finance taught in Schools?

Everything my brother knows about finance is self-taught by researching online, why is something so crucial to life not part of the school curriculum?

We all remember the dreadful days sat learning algebra at school, but does anyone actually use it in their job or personal life? Apart from a few exceptions, the simple answer is NO!

Surely learning about how to budget for household bills or what to look for when shopping for a mortgage would be more useful than learning the value of x.

It's easy to jump in and blame the school system for not changing the curriculum, but should parents be taking on some of the responsibility?

“It’s pretty much how we get anything added to the curriculum. When parents said children needed to be computer literate, the schools started responding. The same thing is true of basic financial literacy.” — Elizabeth Warren, United States Senator

Why are Gen Z more serious about their finances than previous generations?

Gen Z were the first generation born into a world with internet. The smartphone had already been around a while, social media was rapidly growing, and they had a constant flow of content that dominated many areas of their lives.

They have also experienced a lot of financial uncertainty, living through the great recession, seeing their parents struggle and now to be hit with the Covid-19 crash. The fintech revolution also hit at a crucial point in their lives, making cashless transactions the norm.

The result — Gen Z are a lot more entrepreneurial and aren’t happy having debt the way previous generations were. They are changing the way the finance industry does things and are more likely to choose a tech provider over a traditional bank to manage their money.

There is now an expectation for financial institutions to up their game and adapt to better support their needs, ensuring they provide technology that is safe, fast, and reliable.

GoHenry, a prepaid card and finance app for children, have users as young as 6 years old.

These days, people under the age of 18 are just as likely as their parents to have a smartphone — and possibly more likely to experiment with a wider variety of apps and services.

Gen X & Older Millennials

These generations were typically taught the ‘traditional’ way of doing things — do well in school, get a job, get married, buy a house & have kids. Although Gen Z have adopted some of the same habits, they aren’t bogged down by the traditions that Gen X & Millennials are.

Information just wasn’t as easily available when these generations were growing up, Google wasn’t launched until 1997 and didn’t really become mainstream until the 2000s, and even then it wasn’t the beast it is today.

Some would say it was a simpler time, but a survey done by Insider has shown that Gen X & Millennials are deep in debt and dealing with a lot of stress related to this.

More than half of all millennials and Gen X respondents said that they were stressed "some" or "a lot" about their credit card, personal loan, or student loan debts.

Should you invest?

Investing is something I only recently took seriously when I became a parent, mainly because I wanted to build financial security for my son. When I started to dive into it, it honestly made my head hurt, but in my opinion if you have the disposable income then it is definitely worth the headache.

A part of me thinks, “I wish I had thought about investment when I was younger, I might be a lot more comfortable now if I had”. But on the other hand, I feel a bit sad that my brother’s generation has been forced to think about these things at such a young age, because frankly if they don’t, there isn’t much hope for their financial future.

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Machela Moorcroft

From her previous role in finance for a not-for-profit in Australia, to her current position at Compleat, Machela has gathered some experiences worth sharing (and reading!). When she’s not herding creatives as Marketing Campaign Manager at Compleat, Machela is a devoted mother to Myles, obsessed with fantasy and sci-fi flicks, and enjoys hiking and hopes to walk the Camino de Santiago one day.