'Doom spending' explained as Gen Z stop saving for houses and blow cash now

Doom spending has become a talking point on social media (Stock photo)

With twentysomethings feeling like the chances of ever owning a home are slim to none, many have turned to "doom spending".

The idea sees Gen Z shun saving for an unobtainable mortgage in favour of living for the here and now. From holidays to luxury goods, doom spending involves using your money to buy what you want, when you want, to best enjoy the present rather than the future.

Although many people claim those wanting to own a house should stop buying pricey coffees, statistics show it would still take 20 years to save for a deposit. But while many agree with the notion of spending for today, others have slammed it for creating a throwaway consumer society and a "generational problem".

TikToker Maria Melchor @firstgenliving explained how young people can seemingly always afford luxury items and fancy holidays despite the cost of living crisis, reasoning that it "helps them keep going" through the hard financial times.

"When older people ask me how young people are affording nice things that they wouldn’t even buy for themselves, I tell them it's because we can't afford anything else," Maria explained. "Homeownership or starting a family is so out of reach that we're using that down payment or kid money on whatever it is we can't afford that'll bring us a semblance of the kind of adulthood we were promised.

"When houses are a million dollar plus and an older couple will likely outbid us anyway, we're gonna relinquish any lingering delusions about homeownership." The pessimistic view has gain a lot of support, and Maria's video has been seen nearly two million times and has over 220K likes.

Many people agreed with her thoughts, as one TikToker commented: "My mother asking me when I'm gonna stop travelling and buy a house. I can't afford a house but I can travel," and a second added: "Older people telling me I should wait till I'm old to have fun, knowing I’ll be weak, and could have health problems at 60."

However, this does raise concerns about the way younger people are targeted by advertisers. A study by the Economist found that young people were more likely to purchase products they saw on social media and use pay-in-instalment options.

And making the matter worse, a new report says social media is only serving to amplify the financial pressure on young people. A study by Experian revealed the staggering impact of toxic social media narratives on young people's finances, especially when it comes to the world of dating and relationships.

It found that the average 18-35 year old racks up £2,250 worth of debt and that more than half of young people (59 per cent), have overspent on a partner or date due to social media pressure, while almost two-thirds (63 per cent) believe social media has influenced people to date for money and materialistic reasons over love.

Another TikTok user commented on Maria's video and said: "Hearing it like this it feels a bit by design. No future to invest in so we spend our present consuming... we are more marketable than ever," and another noted: "This is partially true, but we also need to acknowledge that we have a generational problem of rampant consumerism."

The Labour Party have announced their plans to help more than 80,000 young people get onto the housing ladder over the next five years if they win the upcoming general election. The scheme will ensure that there are low-deposit mortgages available for first time buyers.

It was introduced by the Conservatives in 2021 when Rishi Sunak was the chancellor of the Exchequer, and was extended until July next year by current Chancellor Jeremy Hunt, however Keir Starmer has pledged to make this a permanent scheme if he becomes the next Prime Minister.

According to the BBC, Keir Starmer said he wanted to "turn the dream of owning a home into a reality" and this scheme sees the government act as guarantor for part of a home loan to encourage lenders to offer low-deposit deals and known as the "freedom to buy".

Labour said that by making this permanent, it will help younger people who may be facing tough conditions in the private renting sector, or those struggling to save. They want to make sure people aren't "locked out of homeownership". In a statement, Keir said that Labour would be "on the side of the builders, not the blockers", announcing the plans around home ownership.

The party leader said: "A generation face becoming renters for life. My parents' home gave them security and was a foundation for our family. As prime minister, I will turn the dream of owning a home into a reality," the BBC added.

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