The cost of living has skyrocketed over the past couple of years due to post-COVID inflation. This has forced many people to find ways to cut back on spending and rely on family or friends for assistance. According to a new research report from Bank of America’s Better Money Habits, 46% of Gen Z relies on financial assistance from their parents or family. Bank of America surveyed 1,091 Gen Z adults aged 18 to 27 to gather this data.
In addition to finding out how reliant Gen Z is on their parents' money, the report also reveals that many are delaying their financial goals. Within the next five years, 40% of Gen Z individuals will not be able to start investing, 46% will not be able to save for retirement, and 50% will not be able to buy a home.
The current economic conditions have forced Gen Z to cut back on expenses and to "trade down" to combat rising costs. 67% reported initiating lifestyle changes by shopping at less expensive grocery stores, limiting dining out, and foregoing activities with friends. Despite these cutbacks, Gen Z still spends more of their extra income on experiences than other generations, following the post-COVID trend of prioritizing travel and unique experiences over saving for the future.
With Gen Z becoming more prominent in the workforce, it will be interesting to see how their spending habits will affect consumer trends around the world.
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