The rise of Generation Z
I’ve heard plenty about the good and bad of Generation X and have stumbled upon reports of the entitled (yet innovative) Generation Y, however, amidst the economic turmoil and rapid growth of technology, the new Generation Z seems to be in a class of its own, curiously uncharacteristic of young people. This group of sober, focused individuals who would rather save then spend is now getting older.
The golden age of the millennials has begun to simmer down. They’re replacing college backpacks and branded hoodies for suits and ties. They’re going through the motions of managing debt and handling bills.
Identified as those born between 1995 and 2008, Generation Z is quite literally the new kid on the block compared to other much older, much more experienced groups. They were heavily scarred by the financial crisis and were (not literally) born with smartphones in their hands. As a generation that has gone mostly unnoticed by companies and talent acquisition initiatives, they have hidden in the shadows of their older siblings. Yet there is a fair bit of difference in terms of behaviour and consumer traits that distinguish them from others, even if they are often mistaken for “mini-millennials”.
They may not seem like much right now but before you know it, we’ll likely have a completely different group with a new set of priorities and a different mentality. Gen Z is expected to make up 40 per cent of consumers throughout the world by 2020 and the oldest among them are already beginning to enter employment. This means that the foundations for massive change are already on the horizon.
What makes Gen Z so special anyway? While experts may never have thought much of the millennials, accusing them of idealism, hedonism, valuing convenience and being rather relaxed with their money, Gen Z, on the other hand, is seen as a rather financially-conservative, careful, pragmatic and ethical group. According to a survey conducted by The Centre for Generational Kinetics, one in five Gen Z-ers are completely against personal debt of any kind, while 56 per cent confess to having discussed saving money with their families in the last six months.
The way Gen Z-ers think, act and consume information appears to be determined by prominent factors in their environment like economic uncertainty and the growing use of technology, especially smartphones. How they see themselves, how they predict their futures and how they enjoy life are all surprisingly different compared to their older counterparts. This is a generation that ravels in the power of technology and one that advocates saving over spending.
As children, they were constantly told about how bad finances were and how hard the recession was. They grew up in an environment that focused mainly on the fear of scarcity which seems to inform their habits as consumers. They may not necessarily be particularly sophisticated in their financial management though, with a large number of them still dependent on their parents, however, their mindsets indicate a rather interesting inclination towards being money-savvy.
Gen Z-ers grew up with advanced technological capabilities at their fingertips, granting them access to information at a very young age and somehow, this generation just isn't too keen on acquiring things, opting instead to rent a bike with a flick of a finger on an app rather than splurge on car ownership and turning away from the traditional notion of buying with credit.
They lean more towards anti-ownership and activist consumerism. They would rather buy products from companies that reflect their own values and are comfortable with fractional ownership, renting or carrying things forward. This scares a lot of companies intimidated by the prospect of these tough future consumers (even if most of these qualities are largely positive).
As a direct result, Gen Z-ers are also prominently entrepreneurial by nature, drawing a direct connection between being successful and having complete control of their lives (at least from a financial perspective). A large percentage of them earn their own spending money through freelance work, part-time jobs or earned allowances from families.
Will this new generation be able to handle their financial well-being more effectively than the previous ones? Will they be able to make more careful and calculated decisions about their future and retirement based on the qualities that they possess? Only time will tell and I for one am intrigued by what the youth of the future may have to offer the world.
Growing your savings
Growing what you already have for a period of time is the answer to generating a good sum of money that will work and grow on it’s own and you reap the reward of these later. Learn how you can invest and diversify your available funds and the kind of options you have according to your risk appetite with me.