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Twenty-somethings blame their lack of savings on overspending on the “good life”.
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Half of Gen Zs blow budgets on shopping, going out
05 December 2023
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Overspending on the “good life” leaves almost half of Gen Z bereft of savings and the majority without any emergency funds, according to a survey of financial habits by Up Bank.
Of the 54,000 people quizzed, 41 per cent blamed saving indiscipline on an addiction to shopping and going out, with the proportion reaching 46 per cent among Gen Zs, who are aged up to 26.
The second most common reason was the “high cost of living”, given by 35 per cent of all respondents although just 31 of Gen Zs.
The difference between age demographics was marked, with 44 per cent of Baby Boomers citing rising prices as the main financial handicap and just 27 per cent saying overspending.
Up’s chief product officer Anson Parker said Gen Zs were prioritising differently and when they saved, it was often for travel or eating out.
“With homeownership feeling out of reach for many young Aussies, there may have been a shift in focus,” he said. “Young people might be putting their savings towards making memories and experiences in order to enrich their life.”
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The survey revealed 52 per cent had made a start on savings and were feeling okay to provide for their future needs with Baby Boomers most prepared at 61 per cent and Gen X furthest behind at only 48 per cent.
However, it found around one-in-six Australians lacked emergency funds and 38 per cent of all respondents said future savings were not looking good, with Gen X (aged 43-58) impacted the most at 42 per cent.
Almost a third of Gen Z claimed that they rarely had money left over before payday and one in four said the biggest unexpected expense that they could cover without going into debt was “losing their phone or laptop”.
In contrast, 29 per cent of Boomers and 28 per cent of Millennials said “they could lose their income for several months”.
Up, launched five years ago as a mobile-only bank, claimed to be the highest-rating banking app in the country with more than 750,000 customers, most under 35.
Its research, dubbed Sound Check, was conducted by using the app’s new Hi-Fi feature and got responses from 54,161 aged 16-plus over two weeks in October to November.
Mr Parker said the Hi–Fi feature was designed to make it easy “to cruise between paydays” by paying bills and ensuring the user hit their budgeting goals.
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