Young people born between 1997 and 2012, known as Gen Z, are facing acute financial pressures as the cost of living rises and economic uncertainty persists. Many are struggling to save, rely on overdrafts, and doubt their ability to achieve milestones like homeownership.
Lauren, a 25-year-old healthcare worker who moved from Birmingham to London in 2021, saw her salary rise from £20,000 to £38,000. Yet she still goes overdrawn mid-month. 'I was basically on minimum wage. Now, I’m on a pretty decent wage, especially for my age, but I’m always on overdraft,' she says. She avoids long-term planning, adding: 'I don’t massively think about too many years into the future.'
In the US, Maddie, 25, works as a wellness coordinator in Pennsylvania earning $17 an hour for up to 35 hours weekly. With rent at $850 a month and other expenses, she says: 'It’s like I’m barely scraping by lately.' She has considered a second job but worries about high petrol costs.
Deloitte’s 2022 global survey found that a third of Gen Z worry most about the cost of living, 45% live paycheque to paycheque, and just over a quarter doubt they will retire comfortably. Experts say these fears are justified: younger generations have less buying power than their parents did at the same age, and homeownership is increasingly out of reach.
Research from the World Economic Forum shows that younger generations are far less likely to own homes than older generations were at the same age, largely because median home prices have risen faster than incomes. In the US, Gen Z have about 86% less buying power than Baby Boomers did at the same age, according to some analyses.
