The Future Of Money

Gen Z and Money: Will the Youngest Generation of Adults Drive FinTech?

Differences in financial stress, and debt burden, are notable by generation

Logica releases its Future of Money study, looking at the future of work and money. Read the full report here.

SAN FRANCISCO, Oct. 2, 2019 /PRNewswire/ — Findings released in the Logica Future of Money Study show that Gen Z is pioneering work opportunities in a social and tech-based workforce. Key findings also indicate an increasing interest in computer-based advice to guide investing, saving, and spending decisions.

Gen Z is entering the workforce during a tech-based and frequently volatile economy. According to the Future of Money Study, nearly one in three Gen Zers (31%) and Millennials (30%) are using side hustles as their only or primary sources of income. They cite tech-based work for these side hustles.

Differences in financial stress and debt burden are notable by generation in the study. While self-reported confidence in making personal financial decisions is relatively high for all Americans, nearly three quarters of Millennials (74%) and Gen Zers (72%) are stressed about finances, while just over half (55%) of Boomers feel the same. The majority (66%) of Americans in the study also say they are likely to use one central hub to manage their financial life. They want features such as push notifications on how they are doing against financial goals and on how they are doing on daily spending. Desire for these push notifications is up from 2018.


Computer-generated investment advice is also trending in the latest Future of Money Study. Findings show that Gen Z leans into robo advice in three key areas, compared to more senior generations of investors. These younger investors are more likely than other generations to say computers can do a better job than humans in the following areas: taking their whole financial situation into account, being easier to work with, and providing better investment performance over time.

“Young people are entering the workforce with an expectation that technology will help them manage their income streams and finances, ” said Lilah Koski, CEO of Logica Research. “This is a dynamic time for financial solutions, and there are a lot of great tools. Companies developing these tools need to understand the users and know how to communicate the benefits so these young consumers will engage in managing their money early.”

Excerpts from the Future Of Money Study

Is Gen Z investing?
We’ve been keeping our eyes on Gen Z (U.S. ages 16-22) and their financial behaviors since the launch of our Logica Future of Money Study in 2017 when Gen Z was just entering adulthood. In general, we find that Gen Z’s financial behaviors are still a blend of their older Millennial siblings and their Gen X parents. This newest generation to enter adulthood is still in the process of developing their own financial identity as they learn how to keep their own budgets, manage payments, save, and invest. And, yes, they are investing: one in five Gen Zers report to us that they are already investing.

Differences in financial stress and debt burden are notable by generation in the study. While self-reported confidence in making personal financial decisions is relatively high for all Americans, nearly three quarters of Millennials (74%) and Gen Zers (72%) are stressed about finances...

We have seen in our Future of Money Study that Americans are looking for more digital integration across their financial lives. We wanted to understand how investors in different generations view computer-based, automated advice vs. human advice on a variety of service- and performance-related (take out hyphen in both places) aspects of investment advice.

All generations see greater benefit in computer-based or automated advice when it comes to cost and fees.

In contrast, when it comes to understanding investing needs, providing advice people can trust and that is in their best interest, Americans tell us that humans win out. There are no significant differences by generation.

We also have seen a shift in perspective in two areas since 2017. Americans are more likely to say a computer provides better investment performance over time than a human and computers are more likely to take their whole financial situation into account, compared to two years ago.

And where does Gen Z fall on the divide between computer-based vs. human advice? In three key areas, Gen Z leans more toward computers vs. older generations.

Is Gen Z showing us where the trend is going or are they just showing us what they need? Let us help you improve the financial lives of our newest generation of adults.

Americans Are No Stranger To Managing Debt
In our Future of Money Study, we found that 67% of Americans carry some type of debt outside of home mortgages. The most common type of debt for Americans is credit card debt (61%) and they are spending about $791 per month to pay off this debt.

Excluding home mortgages, Americans in our latest Future of Money Study are carrying an average of $28,500 in debt, with the typical amount, or median, $9,000. We found that Gen X carries the most amount of average debt at $38,033, followed by Millennials with $26,518, Boomers with $23,753, and Gen Z with the least amount of average debt at $11,173.

Despite having half as much debt as other generations, we found that Gen Z spends just as much or more as their older counterparts to pay down debt on a monthly basis. This includes over $1,500 per month towards personal and student loans. It’s clear that younger generations are taking this debt seriously at any amount. 

Read the full report here.




About the Future of Money Study
The Logica Research Future of Money Study is conducted by Logica and is designed to provide insights to organizations to help improve people’s financial lives. The results reported here are from the Spring 2019 wave. The study is conducted online among 1,000 U.S. General Population Adults 18 and over. The sample is balanced on gender, income, and age. The study includes an augment sample of 200 older Gen Z (16-22, which is not included in total). Results are not weighted.
About Logica Research
Logica Research provides insights to improve people’s financial lives and drive business growth. Our clients include Fortune 1000 companies and leading marketing and PR agencies.