Australian Gen Zs, aged 18 to 26, are more worried about their finances than any other age group, with finances a major concern for this group (68%) than in any other group (57% of non-Gen-Zs), according to new nationwide research by ASIC’s Moneysmart program.
The ASIC study revealed that a staggering 82% of Gen Zs are feeling financially stressed; as they grapple with high levels of personal debt, averaging $8,188 compared to non-Gen Zs at $6,730. One in five (21%) of Gen Zs, equivalent to 600,000 people, carry $10,000 or more in personal debt, with 4% holding $50,000 or more.
Adding to the financial strain, 28% of Gen Zs resort to buy now pay later (BNPL) products, a higher rate than the 21% observed in non-Gen Zs. In regional Australia, the use of BNPL products is even more pronounced, with 34% of Gen Zs utilizing them compared to 26% in metro areas.
Concerningly, ASIC also found that 25% of Gen Zs, or 720,000 people, have savings below $1,000, while a further 8%, or 217,000 people, have no savings at all.
Encouragingly, Gen Zs were twice as likely as other generations to want to improve how they manage their finances, with nine in 10 having a strong desire and intent to enhance their money skills and financial confidence despite the challenging financial landscape.
However, the ASIC research identified barriers hindering Gen Zs’ financial literacy journey, with 49% of those who aren’t financially confident feeling overwhelmed while 42% were unsure of where to start.
The research also found that 77% of Gen Zs want to learn things quickly. They are also twice as likely as other generations to use social media (56%) for advice on managing money, while only 23% of non-Gen Zs do the same.
Faced with the rising cost of living, 39% of Gen Zs are contemplating securing a new or additional job as a response to cost-of-living pressures, ASIC found.
In response to these findings, ASIC’s Moneysmart program is launching a consumer awareness campaign aimed at empowering Gen Z with essential financial knowledge.
The campaign highlights that in the time it takes to complete routine tasks, Gen Zs can also take actionable steps to manage their finances, such as creating a budget, setting savings goals, and tackling debt.
“We want to show them that it doesn’t take a lot of time to make a start with small steps that will make big differences long term,” ASIC CEO Warren Day (pictured above) said in a media release. “We’re encouraging Gen Zs to use the free tools at moneysmart.gov.au as a starting point to be more in control of their money.”
The campaign, now out on Moneysmart channels until mid-December, aims to alleviate financial pressures during the festive season.
“Learning how to plan and save, and deal with their expenses, sets up young Aussies for their future,” Day said. “We hope this campaign, through its practical tips, will help people feel more in control of their financial lives.”
Read the key research findings relating to Gen Z.
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