Educational
Gen Z And Their Finances: What They’re Getting Right (And What They Can Learn From Millennials And Gen X)
March 4, 2025
this generation is growing up with smartphones in their hands, side hustles as a norm, and a desire for financial freedom that’s influencing the entire economy. But just like every generation before them, they have lessons to learn—and teach.
Whether you’re a Gen Zer, a Millennial, or a Gen Xer trying to figure out how to connect with the younger crowd (or even learn from them!), there’s plenty to explore about how Gen Z is handling their money.
Let’s dive into what Gen Z is doing right, where they can learn from Millennials and Gen X, and a few financial tips for everyone.
Gen Z’s Spending Habits – A Snapshot
- Digital Natives with Online Shopping Preference: Over half (56%) of U.S. Gen Z consumers prefer online shopping over in-store experiences.
- Emphasis on Sustainability: A significant 73% of Gen Z consumers are willing to pay 10% more for sustainable products, highlighting their commitment to environmental responsibility.
- Influence of Social Media: Platforms like Snapchat play a crucial role in their purchasing decisions, with 89% of Gen Z using it and 73% exploring products after seeing ads on the app.
What Gen Z Is Getting Right
1. Digital-First Money Management
Gen Z grew up with Venmo, Cash App, and online banking. They’re pros at managing money through apps, making financial decisions faster and with more convenience than ever before. Gone are the days of paper checks and bank trips—Gen Z does it all from their phones.
Tip: Take advantage of digital tools like Peoples Savings Bank’s online banking and mobile app to track spending, set budgets, and save smarter!
2. Side Hustle Savvy
Whether it’s reselling clothes on Depop, freelancing online, or creating content on TikTok, Gen Z is all about the side hustle. They understand that diversifying income is key, and they’re not afraid to put in the extra work.
Tip: Diversifying income streams is smart for any generation. Consider side gigs that align with your interests to boost your savings. You can sign up for an online marketplace for freelance services like Fiverr and do everything from writing to translating and more.
3. Prioritizing Experiences Over Things
Gen Z values experiences—like travel and events—over material goods. They’re more likely to spend on memorable experiences than on luxury items, helping them avoid the trap of lifestyle inflation.
Tip: It’s all about balance. Make memories without draining your bank account by setting experience budgets and using tools like PSB’s savings accounts to set aside funds.
Plus, if you love to travel, open a VISA Signature Travel credit card (earn 1.5 points per dollar on net purchases) or Excursion VISA Signature credit card (earn 2% cash back on air travel, hotels, and dining, and 1% on all other purchases) through PSB.
What Gen Z Can Learn From Millennials
Millennials (born between 1981 and 1996) have grown up in a time of rapid technological change and economic uncertainty. Here are some lessons Gen Z can learn from them:
1. Dealing with Debt
Millennials have been navigating student loan debt for years, and they’ve learned the hard way about interest rates and repayment strategies. Gen Z can learn from this by being cautious about student loans and paying off high-interest debt first.
Tip: Pay down high-interest debt first, and explore student loan forgiveness options if eligible. Learn more about navigating student loans here: Navigating Student Loans: Your Roadmap to Financial Success
2. Investing for the Long Haul
Millennials witnessed the 2008 recession and have been cautious about investing. But they’re catching on to the power of long-term investments. Gen Z is curious about crypto and NFTs, but they could benefit from understanding tried-and-true methods of investing in stocks and retirement accounts.
Tip: Start investing early—even if it’s just a little bit each month. Compound interest is your best friend!
3. Get Started Early and Don’t Be Afraid to Seek Help
It’s never too early to start laying a good financial foundation and it’s easier to start when you’re younger! But if you’re feeling overwhelmed, it’s important to seek the help of a financial advisor. A financial advisor can help you create a plan for meeting your goals, save money, and invest wisely.
Tip: Financial advice can be found everywhere and it’s important to verify the credibility of your sources, particularly if it’s coming from influencers that are actually brand ambassadors and not experts.
What Gen Z Can Learn From Gen X
Gen X (born between 1961 and 1980) has learned a thing or two about managing finances over the years. Here are some lessons Gen Z can learn from them:
1. Building Credit Wisely
Gen X grew up before the days of instant credit checks and social media. They learned the importance of building and maintaining good credit the old-school way. Gen Z should remember that while “Buy Now, Pay Later” apps are convenient, they can also impact credit scores.
Tip: Use credit wisely. Pay bills on time and keep credit utilization low to maintain a healthy credit score.
2. Saving for a Rainy Day
Gen X has been through economic ups and downs, teaching them the importance of having an emergency fund. Gen Z can also learn the value of setting aside at least three to six months of expenses for unexpected situations.
Tip: Open a dedicated emergency fund with Peoples Savings Bank and automate savings to build your safety net. Learn more about our savings account options today.
3. Building Your Retirement Savings Early
Retirement may feel like it’s super far away, but starting retirement savings early allows for compound interest to work in your favor. Even small, regular contributions to retirement accounts can grow significantly over time.
Tip: Take advantage of employer-matched retirement contributions—it’s essentially free money for your future. If your employer doesn’t offer a 401(k), consider opening an IRA.
Bridging the Generational Gap: Financial Tips for All Ages
No matter what generation you’re in, some financial tips stand the test of time:
- Automate Savings: Make saving money easy by setting up automatic transfers.
- Budget with Purpose: Track your spending to understand where your money is going.
- Invest In Yourself: Education and skill development can pay off big in the long run.
- Plan for the Future: Retirement may feel far away, but starting early makes a huge difference.
Final Thoughts: Learning From Each Other
Every generation has its financial strengths and struggles. Gen Z is bringing new ideas to the table with digital-first thinking and entrepreneurial spirit. Millennials have navigated economic turmoil with adaptability. Gen X has built resilience and wisdom from experience.
At Peoples Savings Bank, we’re here to help you wherever you are on your financial journey. Whether you’re starting out, saving for a house, or planning for retirement, we’ve got the tools and resources to make your money work for you.
Ready to get started? Visit Peoples Savings Bank and explore our savings accounts, credit cards, and lending solutions today.