Gen Z Questions the Purpose of Saving Money, and Experts Warn This Attitude Could Be Risky

Generation Z is grappling with significant economic unease. A recent Credit Karma poll reveals that nearly half of adult members of this generation, now in their late 20s, feel that planning for the future is “pointless.” This sentiment is largely driven by a free-spirited approach to summer spending, as many young adults express feelings of financial “despair” and “hopelessness.” Courtney Alev, a consumer financial advocate, highlights the perilous mindset that leads to excessive spending without consideration for the future, potentially resulting in high-interest debt and the postponement of important life milestones.

Despite these financial challenges, experts agree that young adulthood is the ideal time to cultivate healthy financial habits. Investing early—even small amounts—can yield significant rewards over time through the power of compound interest. Alev notes the long-term financial implications for young people who neglect their future and indulge in reckless spending.

The current economic climate understandably contributes to Gen Z’s disillusionment. The job market has proven difficult for new entrants, with unemployment rates for young adults significantly higher than the national average. Many graduates face mounting debt concerns, with around 50% of recent bachelor’s degree recipients graduating with an average student loan debt of $29,300.

Efforts to relieve this burden through debt forgiveness have often faltered, further exacerbating feelings of uncertainty. Credit card delinquency rates among Gen Z are increasing, as more individuals max out their cards. The appeal of buy-now-pay-later schemes has only intensified their spending habits, with 77% of Gen Z users acknowledging that these services encourage them to overspend.

To navigate this financial malaise, experts advise young adults to restructure their financial outlook. Investing, even in modest amounts, should be viewed as an opportunity rather than an impossibility. With time on their side, young people can harness the advantages of investment growth and take advantage of employer-sponsored retirement accounts to secure their financial futures.