The Financial Security of Gen Z: Unveiling the State of Personal Finance Among Young Adults

Gen Z, financial security, personal finance, young adults

Discover how Gen Zers aged 18-24 are taking proactive steps to secure their financial future and make intelligent money choices. Gain valuable insights into their financial security and learn how to build a stable financial foundation. Dive into the world of personal finance with this insightful blog post!

Dive into the world of personal finance as we unveil the financial decisions made by Gen Zers (18-24 years old) after graduating high school. Discover how this emerging generation is taking proactive steps to secure their financial future and make intelligent money choices. Explore the various factors that contribute to their financial security and gain valuable insights for building a stable financial foundation.

Gen Z arent just kids and teenagers anymore. Adult Gen Zers (18-24 years old) are graduating from high school and starting college or a career. This is the time when they may begin to feel a measure of financial independence for the first time, but what are they doing with it? Its a critical question given the negative impact the coronavirus pandemic has had on this age group, including delayed financial milestones and high rates of unemployment.

To answer this question, Ive compiled data from our recent polls and tried to put together the puzzle.

Heres what Ive gathered.

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State of Gen Z personal finance

  • Gen Z are iffy about taking on debt
  • But they arent big on savings either
  • Gen Z may be responsible cardholders
  • But they mainly pay with debit cards
  • Gen Z are off to a rough financial start
  • And they have little or no financial guidance

Gen Z are iffy about taking on debt

I often hear the sentiment from my Gen Z friends that they generally avoid debt, and credit card debt especially. It turns out its not a consequence of me hyping up the best credit cards so much that they dont want to hear about them ever again. Its a common sentiment among Gen Zers, and we have data to prove it.

For example, an early 2020 Bankrate poll showed that 45 percent of Gen Z had no debt prior to and during the pandemic as of May 2020.

Further, according to a survey from, 50 percent of Gen Z had no personal debt as of December 2020. The same survey reported that the main source of debt for this generation was, as you might have guessed, student loans—24 percent of respondents admitted to having student debt, with credit card debt trailing behind at 12 percent.

Gen Z arent big on savings either

The best preventive medicine against falling into debt is savings. Still, the young generation doesnt seem to be in a rush to save for a rainy day—much like many other Americans of all ages.
Our poll from last year showed that 32 percent of Gen Z didnt have emergency savings before or during the pandemic and 20 percent decreased the savings they had. Ironically, 19 percent of Gen Z respondents in the same survey reported adding to their credit card debt in the pandemic. While this is just a guess, Im thinking these last two numbers may be connected. When an emergency hits and you have no financial safety net to fall on, many people choose to rely on their credit cards. Perhaps Gen Z follow the same behavioral patterns.


Gen Z may be responsible credit card holders

When Gen Zers get into credit cards, theyre seemingly drawn to credit card rewards. Our poll from last month showed that 36 percent of Gen Z have a rewards card. It might not seem like a huge number, but remember that Gen Zers are young, and building credit good enough for a rewards card may take some time.
Gen Z rewards card holders are also cautious with their credit cards, with 81 percent of respondents saying they tend to not carry a balance. This may mean that they apply the best credit practices, since paying off your card in full every month is good for both your credit and budget. On the other hand, this may also mean they simply dont use credit cards they have, especially considering their preferred payment method.

Gen Z mainly pay with debit cards

The majority of Gen Z prefer paying with a debit card across common categories such as gas (32 percent), groceries (44 percent) and restaurants (46 percent).

However, credit cards are their preferred payment method for travel expenses, with 23 percent choosing a card to pay for airfare and hotel. Note that many Gen Zers dont spend on travel at all, with 50 percent reporting not buying airfare and 45 percent not booking hotels. Considering the pandemic has stolen over a years worth of trips and vacations from us all, this is not surprising.

Despite using credit cards on travel expenses, Gen Z have chosen cash back as their favorite redemption option in the pandemic, which has been a trend for each generation. In 2020, 30 percent of Gen Zers redeemed rewards for less than $300 in cash back or gift cards, and 18 percent redeemed for $300 or more in cash back or gift cards. As is also the case with other generations, many Gen Zers (30 percent) have held on to their rewards during the coronavirus crisis.

Gen Z are off to a rough financial start

Unfortunately, the pandemic has delayed much more than trips and vacations. Another survey weve conducted this year found that the pandemic has hit pause on financial milestones for many Americans.

This is especially true for young people. For many Gen Zers, the coronavirus crisis has meant a slower journey to financial independence. Weve found that 54 percent of Gen Zers have delayed a financial milestone in the pandemic.

For example, 21 percent of respondents said they delayed pursuing career opportunities, and another 21 percent decided to wait before furthering their education. Seventeen percent also hit the brakes on buying a car, which I suspect might be the first car for many of them.

Additionally, more Gen Zers (32 percent) moved than any other generation during the pandemic. However, 14 percent of Gen Z respondents came back home after relocating, which may mean that moving stopped being financially feasible for them or that the pandemic changed their plans. Plus, most of those who relocated (30 percent) said it was to be closer to family and friends, and 25 percent reported it was for more affordable living.

I find it sad that COVID-19 has had this effect on young peoples financial lives. Its one thing battling its economic consequences when you have something to lose, and another when you havent even had a chance to start.

Some Gen Zers graduated into the chaotic job market and others found themselves unemployed. They were even called the most unemployed generation. It might very well be that theyre on the path to the same financial struggles millennials have been going through.

Gen Z has little or no financial guidance

In tough situations like those facing Gen Z, good financial advice can be invaluable and prevent many costly mistakes. Unfortunately, financial education has been a pain point for many Americans—Gen Z included.

A recent poll from found that 28 percent of Gen Zers learn about finance from social media, which the majority of respondents also see as the least reliable source.

Without a doubt, social media platforms may offer useful information in easily digestible form. Some authoritative sources may also have accounts—for instance, did you know Bankrate is on TikTok?

In the end, though, its always up to the user to find trustworthy accounts and creators. Knowing the flurry of content we consume on social media every day, I doubt many Gen Zers take their time to verify reliability of each video that appears on their feed.

Whats worse, 22 percent of Gen Z get no financial advice at all. In these challenging economic times, having some guidance can be crucial.

Lack of financial knowledge is one of the most common reasons behind poor money management (Im speaking from personal experience here), so I hope more Gen Zers seek that knowledge—beyond their social media feeds.

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