A significant number of Gen Z adults find themselves reliant on financial assistance from parents and family members amidst rising living costs and inflationary pressures.
According to a Bank of America report surveying individuals aged 18 to 27, 46 percent of respondents stated they depend on family financial support. Half of the respondents also expressed concern about their inability to purchase a home within the next five years.
Additionally, 46 percent admitted they felt unprepared to save for retirement, with only 15 percent of Gen Z saying they put a set percentage of their paycheck into a savings account. 40 percent of respondents expressed they were not ready to start investing within the same timeframe.
“Gen Zs are coming out and becoming independent, so I think if I were to want to see progress in a category, that would be… Gen Z becoming more independent from family and friends.” Holly O’Neill, Bank of America’s president of retail banking, told reporters. “Maybe I’m biased because I have three Gen Zs I’m trying to make independent, but I think that’s a marker that they’re setting a budget and they’re living up to that budget, so that’s an area I’d like to see some progress on.”
However, the survey also revealed that 57 percent of Gen Z respondents lacked sufficient emergency savings to cover three months of expenses if they were to lose their income. Nearly 67 percent reported making lifestyle adjustments due to increased living expenses, including reducing dining out, limiting social activities, and opting to shop at less expensive grocery stores.
“Though faced with obstacles driven by the cost of living, younger Americans are showing discipline and foresight in their saving and spending patterns,” said O’Neil. “It is critical that we continue to empower Gen Z to work toward achieving financial health and meeting their long-term goals.”
This piece first appeared at TPUSA.
