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Gen Z have special challenges in saving money, and social media is part of the problem. These emotional triggers are holding Gen Z back from financial success. [[{“value”:”
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It can be hard to be young, and Gen Z in many ways has had an especially tough time during the past few years of the global economy. Gen Zers got hit hard by COVID-19, high housing costs, and rising inflation. If you’re in your early 20s and just trying to get started in life, it can feel like everything gets more expensive while your paycheck stays too small.
A new survey from Empower shows an interesting glimpse inside the everyday spending of Americans — and why Gen Z is facing challenges that their parents couldn’t have imagined.
Let’s look at the top “emotional trigger” reasons why Gen Z struggles to save — and learn how to fight back!
Spending while bored — the new Gen Z national pastime?
A recent survey from Empower, “How Americans’ spending habits are changing,” found that many Americans spend money based on emotion. Far from being rational economist-like decision makers who do price comparisons and diligently save up for every purchase, lots of Americans spend money based on how they’re feeling that day or how much stress they’re under at work.
The Empower survey found:
20% of Americans spend more money due to feelings of “job stress/burnout”20% spend more money due to “anxiety/uncertainty”25% of Americans spend money while bored — including 43% of Gen Z.
Gen Z is the generation most likely to spend extra money out of boredom; it was this age group’s top emotional trigger for spending. The news about emotional triggers is not all bad. Some Americans also spend money when celebrating (32%) or feeling joy and elation (20%).
There’s nothing wrong with spending money to celebrate a happy occasion or a pay raise. But if you’re spending money out of a sense of doom, or just mindlessly spending on stuff you see popping up in your social media feed, that could be a bad sign that you’re not really using money for your highest goals.
Social media peer pressure: Keeping up with the Joneses
Social comparison and envy about money is nothing new, but social media takes it to intense and often unhealthy new levels. If all your friends are posting on social media about their latest amazing vacation or their expensive new car, it can make you feel worse about yourself, and wonder if you’re falling behind.
The Empower study found that 24% of Gen Zers have felt pressure to show off their wealth on social media. Some of the biggest wealth indicators that Americans mentioned seeing on social media include:
Posts that casually mention spontaneous travel (53%)Posting from luxury gyms or personal training sessions (43%)Showcasing high-end tech purchases/gadgets (40%)
Gen Z’s time spent on TikTok and other social media apps can provide comfort, community, and cute videos of pets. But your social media feed might also be making you feel extra financial stress and distorting your perceptions about money. Try not to feel self-defeating envy from the perfect-looking lives of others. Focus on replenishing your savings account instead.
Interestingly, there seems to be a backlash brewing against the high-spending influencers who show off their fancy lifestyles on social media. The Empower survey found that 47% of Americans have negative sentiment toward people displaying wealth on social media, while only 8% view it positively.
Could society’s standards be shifting? Maybe in the future, flaunting your money online will be considered distasteful and boring, and it will be considered “cool” to post about being frugal and buying jeans at Costco. This middle-aged dad knows what the TikTok teens like!
Bottom line
It’s normal to have emotions, and money can be a way of showing what we care about and celebrating the little moments along the way. But if you feel as if your personal finances are out of control, understanding the emotional triggers of everyday spending can help you get back on track. Instead of doom spending and boredom-scrolling, download a budgeting app. Understand where your money is going. Embrace the TikTok trend of “loud budgeting” to declare independence from social media peer pressure and establish boundaries about how (and when) you spend.
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