Gen Z is doing (almost) everything correctly when handling their money — and still facing financial setbacks

(SeaPRwire) –   Being young isn’t quite as carefree as it used to be. If you talk to the parents of those in their twenties—members of Gen Z—you will likely hear them acknowledge that today’s youth face significantly greater challenges than previous generations did.

In many respects, that assessment is accurate.

Data from Harvard’s Joint Center for Housing Studies indicates that home prices are now five times the median income, a sharp increase from the three-times ratio seen in the 1990s. Furthermore, the average age of a first-time homebuyer has climbed to 40, compared to 29 in the 1990s. Beyond the average student loan burden of roughly $20,000, Gen Z individuals are also managing $500 more in credit card debt than millennials did at the same age. Recent college graduates are facing higher unemployment rates than the general population, a trend not seen in decades—and this is all occurring before the full impact of AI on the labor market is realized.

Nevertheless, Gen Z deserves credit. This generation is working harder than its predecessors to manage their finances responsibly. They are diligent savers, putting money aside at three times the rate young people did in the 1990s. During that same timeframe, the number of young adults holding retirement accounts has grown by 36%. They are also more active investors; according to the JPMorgan Chase Institute, while only 8% of people in their early 20s were investing (outside of 401(k) plans) a decade ago, that figure rose to 40% by 2025.

Their earnings are also higher, with the median income for those in their 20s and 30s currently 19% greater than it was for their counterparts in the 1990s.

A college degree still provides a financial advantage. Despite public skepticism regarding the value of higher education, recent data shows that median earnings for young people with bachelor’s degrees are 59% higher than for those with only a high school diploma. Additionally, a recent Gallup poll reveals that 9 out of 10 college students feel confident or very confident that their education will provide the necessary skills for employment.

They are also better shielded from financial catastrophe. Health insurance serves as a vital safeguard for savings, and Gen Z has high rates of coverage. In the late 1990s, nearly 25% of individuals aged 21 to 40 were uninsured; today, that figure has dropped to 15%.

While these efforts are commendable, there is a concern that Gen Z struggles to distinguish between sound financial guidance and advice that is biased or potentially predatory.

This generation has been heavily marketed the idea of “buy now, pay later” (BNPL). According to LendingTree, 59% of Gen Zers utilize BNPL services, yet as of early 2026, 57% of those users have missed a payment. Consequently, a service presented as a convenient, interest-free option often results in significant interest charges and extra fees.

While frictionless payment methods like “Tap to Pay” offer great convenience, they also make it easier to overspend and overlook the fact that credit card interest rates are hovering near record highs of 22.3%. This demographic has also embraced volatile cryptocurrency markets, with roughly half of U.S. Gen Zers reporting they own or have owned crypto—double the rate of those in their 50s and 60s. Gen Z has also engaged heavily in online gambling and prediction markets. A NerdWallet survey found that 69% of 18- to 26-year-olds have participated in gambling, compared to 57% of baby boomers. More concerning is that one-quarter of Gen Z and millennials view online gambling as a form of investment.

In summary, while this generation has adopted FinTech for its seamless digital experience, these tools do not always lead to wise financial decisions, particularly when the goal is long-term stability. Given that 79% of young people turn to social media platforms like Instagram and TikTok for financial advice, they are often conditioned to seek quick profits. Instead, they should prioritize reliable, time-tested information that fosters long-term success.

For over three decades, I have provided such practical financial guidance. My book, Get a Financial Life: Personal Finance in Your Twenties and Thirties, will be released this May in a 30th-anniversary edition updated specifically for Gen Z.

We must support Gen Z by ensuring they can differentiate between helpful advice and mere hype.