Gen-Z may not be the reckless generation that many see them to be. A recent Nielson-AngelOne report revealed that 93 per cent of young adults were consistent savers, with the majority saving 20 to 30 per cent of their monthly income.
The financial habits of Gen-Z are a reflection of the world they grew up in. Raised amidst the boom of technology, economic uncertainty, and information overload, the youth of this generation seem more careful about managing money at a younger age.
Surrounded by a completely digital environment, the Gen-Z population exhibits a natural affinity and smooth integration of technology into their daily lives.
However, their constant exposure to social media has also made them easy targets of trends and viral hashtags. Impulsive buying behaviour and brand loyalty are shaped significantly by social media and advertisements.
Gen-Z do not shy away from spending, unlike previous generations. Many indulge in ‘guilty pleasures,’ even if it leaves them with an empty bank account by the end of the month. With the increase in overconsumption, it is common to see many spend their money on things that they may consider unnecessary.
At the same time, the digital revolution has promoted the high usage of mobile apps, e-wallets and online banking sites.
Investment through other mediums remains relevant among the Gen-Z population, with many opting for gold investments as their preferred option.
“In the future too, I am planning to invest my savings in gold or own some land since I think it’ll be of greater profit in the future,” Silpa P.M., a 22-year-old trainee at an architectural firm, told THE WEEK.
While the two generations could be dubbed tech-savvy, behavioural differences are apparent.
According to a study conducted by the International Journal for Multidisciplinary Research, millennials, who have greater financial liabilities, favour generally secure, low-risk avenues of investment, such as SIPs, real estate, and retirement funds.
Millennials in India, despite the wish to save money, struggle to do so in this economy. Yet, a majority of them do make an effort to set aside their earnings as savings.
However, newcomers to the corporate world have criticised their low incomes as insufficient to pay their bills. Many complain about the cost of living in the current economy where even the roof over their head takes up half of their salary.
“The income that I received, especially in my initial years, was only enough for my basic needs. I needed to use my income to support my family, pay rent, and cover other bills. This way, I didn’t have anything to save or keep aside,” says Ayana M., a 26 -year-old draughtsperson working at a design firm in Kochi.
Others, who have learned to survive the corporate job atmosphere argue that despite the challenges, you can save money if you lead a simple lifestyle. Many of them invest in stocks and mutual funds, while others invest by purchasing gold.
Many in their early twenties who struggle to save point out that living on a modest income is only manageable for those from privileged backgrounds. Owning a house and having parents who can take care of their finances help lead a ‘simple lifestyle,’ say some.
The financial habits among Gen-Z and millennials are ever-evolving. With the fast-paced environment and technological advancements, the youth of the country are learning to adapt efficiently.
