About 87 percent of Gen Z \u2014 people between the ages of 18 to 28 \u2014 say they are willing to spend money on nonessential items, like streaming services, dining out, and fitness memberships, no matter the state of their finances, according to a new poll. The Harris Poll questioned 2,074 US adults for Intuit Credit Karma, a personal finance platform.<\/p>\n
The poll found that 74 percent of Gen Z-aged people said they were willing to cut back on non-essential spending if their financial situation worsened. That compares with 82 percent of millennials, 86 percent of Gen X, and 87 percent of baby boomers. <\/p>\n
At the same time, more than half of Gen Z members say they are struggling to make ends meet, yet a majority buy themselves a small treat, such as a pastry, coffee, or sweet, at least once a week. That can lead to overspending, according to a new study of more than 1,000 people done for Bank of America<\/a>. <\/p>\n Shikha Jain, partner and head of consumer North America at Simon-Kucher & Partners, a global consulting firm with an office in Boston, said Gen Zers spend more on experiences outside the home, such as dining out or travel. This could be due to two reasons, she said: young people can\u2019t afford to buy homes, and social media has made travel more alluring.<\/p>\n The average age of a homeowner is now 38, up from 35 in 2023, according to the National Association of Realtors<\/a>. Because fewer young people are buying homes, they have more to spend on experiences, Jain said.<\/p>\n \u201cGen Z does face more economic uncertainty than their older peers,\u201d Jain said. \u201cThey tend to live paycheck to paycheck, [and] have more student debt than millennials.\u201d <\/p>\n Psychology might also explain the spending. Doom-spending, or purchasing nonessential items in order to cope with unpleasant feelings, is also trendy among Gen Z, Jain said. It\u2019s easily done, because they can buy anything at the touch of their fingertips on a phone, she said.<\/p>\n Greg Stoller, a master lecturer at Boston University\u2019s Questrom School of Business, said Gen Z \u201ctends to have an impulse, on-demand approach to almost everything.\u201d <\/p>\n \u201cYou see something that you like, or if you\u2019re hungry, you just buy it, and you don\u2019t even have to take out a credit card anymore,\u201d Stoller said. \u201cYou swipe your phone or swipe your watch and, voila, it\u2019s yours.\u201d<\/p>\n DaSilva, the finance professional, said she\u2019s learned how to budget through her job. Working in that industry has taught her what percentage of her paycheck to put toward expenses. She said she budgets 50 percent of her pay toward rent, bills, and food \u2014 the essentials. Another 12 percent to retirement and 5 percent towards savings.<\/p>\n Connor Morrow, 25, of Boston, has a TikTok account where he shares financial advice and budgeting content. A typical video of his shows how much he spends on groceries, rent, dining, health, transportation, and shopping. In one video,<\/a> he shows what he spent in September \u2014 almost $1,400 on rent, $280 on household supplies, $110 on transportation, $225 on groceries, $715 on dining out, $340 on health\/medical, and $460 on miscellaneous expenses. <\/p>\n He started making the videos because he found the tallying helpful and said transparency was important. <\/p>\n \u201cThere are always comments I get critiquing what I spent this month,\u201d Morrow said. \u201cI think that\u2019s sort of a sign that people do want to see some fairly transparent, fairly open, but realistic information out there.\u201d<\/p>\n