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Gen-Z & Money

Navigating Finances in a Digital Era

Generation Z, or Gen-Z, refers to the demographic born between the mid-to-late 90s to the early 2010s. This generation has witnessed many significant historical events, from the release of the first-ever iPhone to a global recession and a life-threatening pandemic. In all these culture-shaping moments, the most prominent outcome distinguishing Generation Z from previous generations is the advancement of technology and digital media. Now, technology has been embedded in schools, workplaces, grocery stores, and other institutions to stay current with the latest digital trends.    

Even our credit union provides a wealth of financial resources online for people of all ages. At Elements, we want to ensure everyone feels supported no matter where they are in their financial journey. This article explores Gen Z’s financial habits while providing insight into spending, borrowing, and saving in the digital age.  

How Does Gen-Z Approach Money?    

The Millennials, also known as Generation Y, witnessed the rise of the Internet era and embraced new social media platforms and online services. In contrast, Gen Z seamlessly integrated these tools into their daily lives, creating new ways to gain wealth. There are numerous ways to make money online; many have even left their traditional corporate jobs to become their own boss. According to Samsung Solve for Tomorrow, 50% of Gen Z aspires to be entrepreneurs, and 21% are interested in working with artificial intelligence. While some young adults are fully committed to online careers, others only take on online gigs to supplement their income. The recent surge in layoffs and inflation has prompted more adults to seek multiple streams of income.    

Additionally, Gen Z’s heavy use of social media has created an environment that promotes unrealistic lifestyles. There is an abundance of content on these platforms that glorifies owning material things and living a life of luxury, with little to no insight into how it can be affordable. With increased income, Gen Z could feel pressured to live up to the social status portrayed online, which can lead to unhealthy financial habits.      

Your financial success is our top priority here at Elements. If you’re a Gen Z or have a Gen Z friend or family member, consider reviewing the following tips and tools for navigating finances with confidence!    

Stowing & Growing Your Money    

There will be countless opportunities to explore, take risks, and learn lessons during your twenties. While prioritizing finances may not be at the top of every Gen Zer’s list, it should not be overlooked. It’s possible to secure your financial future while enjoying the present. The key is understanding the potential of saving and investing early on.    

Here are a few special accounts that Elements offers to help members stow and grow their funds:    

High Interest Checking Account 

Setting up a checking account that pays you back is a great way to maximize your finances. With a High Interest Checking Account, you can accumulate interest each month, giving you extra money just for using your debit card! Read more about Elements High-Interest Checking Account.      

High Yield Savings Account 

A High Yield Savings Account is an NCUA-insured account that also grows your money over time. These accounts give you more dividends on your money than many other types of accounts  with easy online access to manage your funds. Read more about Elements’ High Yield Savings.

Savings Certificates   

Certificates typically offer higher returns than most regular savings accounts. With these accounts, you choose the term, but you must wait until the term is complete to access the funds. This can help you save for upcoming purchases, such as a new car or a down payment on a home. If you prefer an account that will allow you to predict your savings balance accurately, this account might be the right choice for you! Read more about Elements’ Certificates.    

Not sure what account you need? Take our easy quiz to determine which Elements account will help you reach your goals.    

Borrowing Money with Credit Cards & Loans    

Now that we’ve addressed checking and savings accounts, let’s pivot to borrowing. There are various ways to borrow money, and each option has different outcomes for you and your finances. Some people prefer the convenience of using debit cards for purchases, while others opt for credit cards to build credit and enjoy cashback rewards.   

Much like credit cards, loans are another way people can borrow money. Loans can help cover larger expenses such as college tuition, a new vehicle, or your first home. Securing a loan is a significant step in a young person's financial journey that comes with responsibility. Although loans can help strengthen your credit score, it’s best to ask for only what you need.  

How do I secure a personal loan?

You can get a loan at your local financial institution. Consider these tips to increase your chances of getting approved:     

  • Maintain a good credit score by paying down debt and making timely payments.   
  • Consider a co-signer to join you on the loan application.     
  • Build a relationship with your local credit union to receive the best rates and fewer fees.    

 Interested in a loan? Schedule an appointment with our loan experts to find the right choice for you!

Saving Strategies for Gen Z    

Managing your expenses can become challenging when a single tap on your phone grants access to your credit and debit cards. Spending and saving are long-term responsibilities, and it’s essential to have effective methods to achieve your financial goals. The internet is buzzing with dozens of budgeting and saving strategies to keep you on track toward financial success. Here are some of Gen-Z’s favorite ways to save and grow their money:      

Bucket Saving  

Saving and budgeting doesn’t have to feel restrictive. When you set goals around what you want, you can save and spend with intention. Consider using savings accounts as multiple "buckets" for different saving goals. Automating transfers to these dedicated accounts can bring you peace of mind and make your financial journey more rewarding.   

The 50/30/20 Rule 

The 50/30/20 rule is a simple budgeting formula for allocating income: 50% for needs, 30% for wants, and 20% for savings. You can even find personalized videos on social media featuring real people applying this rule to their income.   

The Envelope Challenge  

Make saving fun by trying this easy challenge! Gather 100 envelopes and number each one, then set aside the dollar amount of the envelope. For example, $1 in envelope #1, $2 in envelope #2, and so on. After 100 days and 100 filled envelopes, you’ll have more than $5,000 saved. Be sure to deposit the cash you accumulate into your savings account regularly.     

Whether you’re a Gen-Zer or part of another generation, our credit union experts are always here to provide trusted advice and guidance. Are you curious about opening a new account? Do you have questions about our loan programs?Contact Elements Financial for support in all aspects of your financial life.  

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