Gen Z Is Judging Millennials' Money Habits

An illustration photo shows a display of credit cards on September 12, 2023 in Los Angeles, California. The majority of Gen Z judged millennials' money habits in a new survey.

Gen Z might not have as much experience when it comes to finances yet, but they have no problem judging the decisions of their elders, including millennials.

According to a Cash App survey, 55 percent of Gen Z said it amazed them how much millennials waste, that millennials spend too much, or they are easily pressured into overspending by friends.

The younger generation, which spans from age 12 to 27, has grown up in a slightly different world than their millennial counterparts, and they might be more inclined to view money differently because of that.

Gen Z, who grew up in an age where sky high student debt was the norm and a pandemic made the job market uncertain, are not without their own financial struggles. In the Cash App report, 53 percent said they've spent beyond their means, but they still see a clear difference in how millennials handle their money.

"Generations love to point out how they differ from their younger or older counterparts, and Gen Z is no exception," Cash App financial therapist Lindsay Bryan-Podvin told Newsweek. "Gen Z has grown up with technology and, because of this, might be more comfortable picking on their millennial generation for being swayed by the influence of social media."

Millennials have historically been more prone to want to fit in, Bryan-Podvin said, while Gen Z values individuality and might be more inclined to spend their money at thrift stores and on experiences instead of name brands and material items.

"Each generation is a product of its economic upbringing. While millennial spending might look 'wasteful' to Gen Z, this could also result from millennials being unable to access the same financial milestones as the generations before them. In other words, millennials might not be able to afford a home by 30, but could afford to furnish their living room," Bryan-Podvin said.

Bryan-Podvin added that there's been a shift in financial education since millennials have grown up and left high school. More Gen Z-ers typically have financial literacy classes offered in school, and they're also more adept at finding these resources online and via fintech.

"Even though millennials are fairly tech-savvy, they still might stumble a bit more over engaging with the nuances of fintech," Bryan-Podvin said.

Drew Powers, the founder of Illinois-based Powers Financial Group, said in his experience, overspending tends to happen at the same rate across all ages.

"Boomers and Gen X overspent on housing and cars, viewing those as necessities, while they maybe penny-pinched on vacations and everyday luxuries," Powers told Newsweek. "In my clients, I see a shift with the millennials to overspend on everyday luxuries and vacations as they choose more frugal housing, possibly because most have been priced out of higher-end housing."

Gen Z likely is a bit too young to have fully solidified their overspending habits and what they usually spend too much on, Powers added, and while technology could help them, it could also hurt them if they aren't careful.

"They were the first generation to grow up with the internet, coming of age at the same time as social media, and will be the most susceptible to influencers and trends as their paychecks grow," Powers said.

Altogether, Gen Z judging the millennials before them could reflect a longstanding trend of generations wanting to differentiate themselves from those before them.

"The silent generation likely judged the baby boomers, much like the baby boomers judged Generation X," Kevin Thompson, a finance expert and the founder and CEO of 9i Capital Group, told Newsweek. "As for money habits, Gen Z seem cautious with their spending and value quality over quantity whereas millennials seek experiences over material goods. Money habits are generally due to the nature of the economy by which they live, and the burden of student debt and rising cost would lead a generation of Gen Z to be more cautious with their spending."

Michael Ryan, a finance expert and the founder of michaelryanmoney.com, said Gen Z often emphasizes saving and investing more while being wary of debt, but that could be because they learned from millennials' past mistakes.

"Interestingly, Gen Z faces higher costs than millennials did at the same age, yet maintains more cautious spending habits," Ryan told Newsweek. "In my experience, financial maturity often comes with age, regardless of generation. There's typically a point where long-term planning becomes a priority over immediate spending."

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