Gen Z has virtually no excuse for financial illiteracy
The financial behaviours of Gen Z have been nothing if not consistent over the last few years. They routinely create trends about the merits of spending while you're young and fun. A few years ago, it was posting the text 'I'll make my money back, but I'll never…' with some image of a perceived once-in-a-lifetime experience.
Now, the cohort is increasingly participating in 'doom spending' – a form of retail therapy that helps consumers cope with everyday stresses – more than older generations. It dovetails with another troubling trend: Almost half of Gen Z – 49 per cent – has decided that saving for the future is pointless, according to a late May Credit Karma survey.
These choices exemplify poor money management skills, a reality that has led Gen Z to blame schools for not teaching them more about how to manage their finances effectively. But of all the generations, Gen Z is the one with no right to complain about the lack of access to personal finance education in school. If any generation had a chance to teach themselves, it is them.
Young adults today have grown up in a world full of easily accessible financial information and services, such as digital solutions for seemingly every method of budgeting. That includes the rise of investing apps and robo-advisers, which provide a low barrier of entry to those ready to get into the stock market. Credit reports and scores are also widely available through free, legitimate services and even credit cards. Gen Zers have had access to content, online and off, that teaches the importance of understanding credit history since before they could apply for a card.
The oldest of Gen Z were only 16 when I started writing about money on the Internet. In the subsequent 12 years, personal finance blogs morphed into podcasts and YouTube shows. Then there was the rise of 'finfluencers' on Instagram and TikTok. Plus, many personal finance personalities with a following got a book deal (me included). There are hundreds, nay, thousands of people across a vast spectrum offering advice on how to handle the almighty dollar.
The democratisation of information should make Gen Z one of the most financially literate cohorts. With answers so easily found on smartphones they carry everywhere, access is hardly an issue. But only 33 per cent of the generation reports turning to social media for financial education, according to a 2025 survey conducted by Spruce, a mobile banking app. However, nearly 70 per cent of them have tried viral trends such as loud budgeting or soft saving compared to 51 per cent of millennials and 27 per cent of Gen X. Of course, the volume of information and competing narratives on topics such as debt repayment or building credit can be overwhelming. It also comes with the potential for misinformation.
A NEWSLETTER FOR YOU
Friday, 3 pm Thrive
Money, career and life hacks to help young adults stay ahead of the curve.
Sign Up
Sign Up
Figuring out what is accurate online can make using the Internet feel exhausting. Lessons on how to navigate the misinformation and learning how to decipher if a sales pitch from a beloved influencer is masking a subpar financial product is critical.
These skills, when incorporated into the school curriculum, might be even more important than basic financial knowledge and habits, because the onslaught of nefarious content online is likely to grow even more pervasive thanks to generative AI.
But the reality is that most of what children and young adults learn about money comes from their home life rather than their schooling. Tossing a single semester-long class into high school graduation requirements, which could be taught by a teacher who is not a personal finance expert, isn't going to be enough to move the needle towards fiscally prudent teens. Parents are the lynchpin in this battle for those coming of age to understand how to budget, save and invest.
Money lessons start to imprint on children much younger than most would expect. A five-year-old child is capable of having an emotional reaction to spending and saving, based on research from a University of Michigan study. There's not a singular understanding as to why and how this happens, but it does mean parents are being watched and can educate well before their child is earning an income of their own. Having an open, age-appropriate dialogue about family finances, modelling good habits and talking through how to save for goals helps lay a foundation.
People with a higher understanding of money basics are more likely to make ends meet and achieve goals like having an emergency savings fund or opening a retirement account, according to the Financial Industry Regulatory Authority's (Finra) 2021 National Financial Capability Study, the most current available.
Of course, the risk of relying on parents to impart wisdom is that they may not be a model example. A preview of Finra's 2025 study, to be released in July, found that only 27 per cent of American adults could answer five of the seven Financial Knowledge Quiz questions. However, with increased access to different resources, there's no reason that parents who themselves feel underinformed need to stay that way.
Financial literacy is one of the most valuable gifts a parent can give a child – even if it means learning alongside them. But for Gen Z, especially those who have already left the nest, gaining that knowledge on their own has never been easier. BLOOMBERG
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Business Times
10 hours ago
- Business Times
Gen Z has virtually no excuse for financial illiteracy
The financial behaviours of Gen Z have been nothing if not consistent over the last few years. They routinely create trends about the merits of spending while you're young and fun. A few years ago, it was posting the text 'I'll make my money back, but I'll never…' with some image of a perceived once-in-a-lifetime experience. Now, the cohort is increasingly participating in 'doom spending' – a form of retail therapy that helps consumers cope with everyday stresses – more than older generations. It dovetails with another troubling trend: Almost half of Gen Z – 49 per cent – has decided that saving for the future is pointless, according to a late May Credit Karma survey. These choices exemplify poor money management skills, a reality that has led Gen Z to blame schools for not teaching them more about how to manage their finances effectively. But of all the generations, Gen Z is the one with no right to complain about the lack of access to personal finance education in school. If any generation had a chance to teach themselves, it is them. Young adults today have grown up in a world full of easily accessible financial information and services, such as digital solutions for seemingly every method of budgeting. That includes the rise of investing apps and robo-advisers, which provide a low barrier of entry to those ready to get into the stock market. Credit reports and scores are also widely available through free, legitimate services and even credit cards. Gen Zers have had access to content, online and off, that teaches the importance of understanding credit history since before they could apply for a card. The oldest of Gen Z were only 16 when I started writing about money on the Internet. In the subsequent 12 years, personal finance blogs morphed into podcasts and YouTube shows. Then there was the rise of 'finfluencers' on Instagram and TikTok. Plus, many personal finance personalities with a following got a book deal (me included). There are hundreds, nay, thousands of people across a vast spectrum offering advice on how to handle the almighty dollar. The democratisation of information should make Gen Z one of the most financially literate cohorts. With answers so easily found on smartphones they carry everywhere, access is hardly an issue. But only 33 per cent of the generation reports turning to social media for financial education, according to a 2025 survey conducted by Spruce, a mobile banking app. However, nearly 70 per cent of them have tried viral trends such as loud budgeting or soft saving compared to 51 per cent of millennials and 27 per cent of Gen X. Of course, the volume of information and competing narratives on topics such as debt repayment or building credit can be overwhelming. It also comes with the potential for misinformation. A NEWSLETTER FOR YOU Friday, 3 pm Thrive Money, career and life hacks to help young adults stay ahead of the curve. Sign Up Sign Up Figuring out what is accurate online can make using the Internet feel exhausting. Lessons on how to navigate the misinformation and learning how to decipher if a sales pitch from a beloved influencer is masking a subpar financial product is critical. These skills, when incorporated into the school curriculum, might be even more important than basic financial knowledge and habits, because the onslaught of nefarious content online is likely to grow even more pervasive thanks to generative AI. But the reality is that most of what children and young adults learn about money comes from their home life rather than their schooling. Tossing a single semester-long class into high school graduation requirements, which could be taught by a teacher who is not a personal finance expert, isn't going to be enough to move the needle towards fiscally prudent teens. Parents are the lynchpin in this battle for those coming of age to understand how to budget, save and invest. Money lessons start to imprint on children much younger than most would expect. A five-year-old child is capable of having an emotional reaction to spending and saving, based on research from a University of Michigan study. There's not a singular understanding as to why and how this happens, but it does mean parents are being watched and can educate well before their child is earning an income of their own. Having an open, age-appropriate dialogue about family finances, modelling good habits and talking through how to save for goals helps lay a foundation. People with a higher understanding of money basics are more likely to make ends meet and achieve goals like having an emergency savings fund or opening a retirement account, according to the Financial Industry Regulatory Authority's (Finra) 2021 National Financial Capability Study, the most current available. Of course, the risk of relying on parents to impart wisdom is that they may not be a model example. A preview of Finra's 2025 study, to be released in July, found that only 27 per cent of American adults could answer five of the seven Financial Knowledge Quiz questions. However, with increased access to different resources, there's no reason that parents who themselves feel underinformed need to stay that way. Financial literacy is one of the most valuable gifts a parent can give a child – even if it means learning alongside them. But for Gen Z, especially those who have already left the nest, gaining that knowledge on their own has never been easier. BLOOMBERG
AsiaOne
2 days ago
- AsiaOne
Australia social media teen ban software trial organisers say the tech works, World News
SYDNEY - Some age-checking applications collect too much data and no product works 100 per cent of the time, but using software to enforce a teenage social media ban can work in Australia, the head of the world's biggest trial of the technology said on Friday (June 20). The view from the government-commissioned Age Assurance Technology Trial of more than 1,000 Australian school students and hundreds of adults is a boost to the country's plan to keep under 16s off social media. From December, in a world first ban, companies like Facebook and Instagram owner Meta, Snapchat and TikTok must prove they are taking reasonable steps to block young people from their platforms or face a fine of up to A$49.5 million (S$41 million). Since the Australian government announced the legislation last year, child protection advocates, tech industry groups and children themselves have questioned whether the ban can be enforced due to workarounds like Virtual Private Networks, which obscure an internet user's location. "Age assurance can be done in Australia privately, efficiently and effectively," said Tony Allen, CEO of the Age Check Certification Scheme, the UK-based organisation overseeing the Australian trial. The trial found "no significant tech barriers" to rolling out a software-based scheme in Australia, although there was "no one-size-fits-all solution, and no solution that worked perfectly in all deployments," Allen added in an online presentation. Allen noted that some age-assurance software firms "don't really know at this stage what data they may need to be able to support law enforcement and regulators in the future. "There's a risk there that they could be inadvertently over-collecting information that wouldn't be used or needed." Organisers of the trial, which concluded earlier this month, gave no data findings and offered only a broad overview which did not name individual products. They will deliver a report to the government next month which officials have said will inform an industry consultation ahead of the December deadline. A spokesperson for the office of the eSafety Commissioner, which will advise the government on how to implement the ban, said the preliminary findings were a "useful indication of the likely outcomes from the trial. [[nid:705771]] "We are pleased to see the trial suggests that age assurance technologies, when deployed the right way and likely in conjunction with other techniques and methods, can be private, robust and effective," the spokesperson said. The Australian ban is being watched closely around the world with several governments exploring ways to limit children's exposure to social media.
Business Times
2 days ago
- Business Times
Meta discussed buying Perplexity before investing in Scale
[LOS ANGELES] Meta Platforms held discussions with artificial intelligence (AI) search startup Perplexity AI about a possible takeover before moving ahead with a multibillion-dollar investment in Scale AI, according to sources familiar with the matter. The two companies could not come to an agreement and decided not to pursue the deal, said the sources, who asked not to be named as the details of the talks are not public. The financial terms under discussion could not be learned. Perplexity recently closed a new round of funding at a US$14 billion valuation. Meta also attempted to hire Perplexity chief executive officer Aravind Srinivas to join the social media company's new 'superintelligence' team, which is focused on building more powerful AI systems, the sources said. The talks with Meta, which have not previously been reported, highlight Meta CEO Mark Zuckerberg's willingness to use deals and big hires to catch up in the AI race. The talks took place before Meta finalised a US$14.3 billion investment in Scale AI that gives it a 49 per cent stake in the data-labelling startup. Meta and Perplexity did not respond to requests for comment. Founded in 2022, Perplexity has emerged as one of the most prominent startups using generative AI to rethink core Internet services. Perplexity is taking on Alphabet's Google by offering an AI tool that summarises search results, lists citations for its answers and helps users refine their queries to get the best responses. The startup is also developing an AI-powered web browser. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Frustrated with the pace of Meta's AI development, Zuckerberg is making a concerted push to poach top AI talent from across the industry with lucrative pay packages. Meta has succeeded in hiring Scale AI's former CEO Alexandr Wang, as well as top researchers from Google DeepMind and Sesame AI. Not everyone is jumping to join Meta, however. OpenAI CEO Sam Altman said in a podcast this week that some on his staff had been approached by Meta with offers of US$100 million signing bonuses and even bigger compensation packages, but had declined to join the company. Meta has been in talks with former GitHub CEO Nat Friedman to recruit him to the new team, according to sources familiar with the matter. The company has also been working on hiring Daniel Gross, the CEO of Safe Superintelligence, a research lab founded by former OpenAI chief scientist Ilya Sutskever, the source said. Meta has also held early discussions for a computing deal in which Safe Superintelligence would use Meta's data centre infrastructure, the source said. Representatives for Safe Superintelligence did not immediately respond to a request for comment. Other Big Tech firms, including Google and have tried to establish themselves as the backbone of the AI ecosystem by providing chips and cloud computing resources to AI startups. Meta has not gone this route to date. BLOOMBERG
