Gen Z workers can't cover a month’s expenses, but could leverage their big advantage over older counterparts

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Maurie Backman

Thu, Apr 3, 2025, 5:00 AM 5 min read

Gen Z has had a pugnacious spell economically. Many graduated assemblage erstwhile the U.S. was successful the throes of the pandemic and unemployment was sky-high. They struggled to find work.

Then Gen Zers were faced with a play of rampant ostentation arsenic the system improved. While ostentation has eased, the outgo of surviving is inactive high.

A March 2025 Bank of America study reveals that 52% of Gen Z employees aren’t making capable to unrecorded the beingness they want, and that ostentation is 1 of their biggest fiscal challenges.

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The study recovered that connected average, Gen Z workers walk astir doubly arsenic overmuch arsenic they earn. They don’t person capable wealth saved to screen adjacent 1 month’s expenses.

This puts an full procreation astatine accrued hazard of indebtedness and vulnerability if they’re laid off.

The Bank of America study recovered that Gen Z’s per-household spending connected some indispensable and discretionary items has grown faster than the wide population.

For example, successful the past year, their spending connected amusement and question roseate 25.5%. Experien reports that the mean Gen Zer carries $3,456 successful credit-card debt.

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While they’re spending a batch connected the present and now, they aren’t redeeming agelong term. Only 20% of Gen Zers are redeeming for retirement, according to a 2024 Teachers Insurance and Annuity Association of America (TIAA) report.

They don’t adjacent person overmuch saved successful their slope accounts. Federal Reserve information shows that Americans nether 35 person little currency successful their transaction accounts than older cohorts, with a median equilibrium of $5,400 — compared to $7,500 for 35 to 44-year-olds; $8,700 for 45 to 54-year-olds; and $13,400 for those aged 65 to 74).

Gen Zers are intelligibly trailing. While portion of that tin beryllium attributed to little wages, it whitethorn besides beryllium a byproduct of the mode they prioritize discretionary purchases.

If you're a Gen Zer without overmuch successful the mode of savings, instrumentality heart. You’re young, meaning you person the vantage of clip to physique wealthiness and money a comfy retirement.