Financial Fitness

Generational Finances Survey

1 in 4 Gen Zers are not confident in financial skills

WalletHub’s new Generational Finances Survey asked about everything from whether people have a budget and whether they feel financially secure to what they feel is the biggest roadblock to their financial success. View the complete survey findings and infographics here.

Every generation wants to be better off financially than their parents, and having a high degree of financial literacy and the skills to make good decisions are key to making that happen. However, Gen Z is the least financially confident generation, according to a new nationally representative survey conducted by WalletHub, which found more than 1 in 4 Gen Zers say they are not confident in their financial knowledge and skills.

Below are some highlights of the survey, as well as a Q&A with WalletHub Analyst Cassandra Happe.

Key Stats

Confidence Crash. Gen Z is the least financially confident generation, as more than 1 in 4 Gen Zers say they are not confident in their financial knowledge and skills.

Gen Z seems averse to risk. 57% of Gen Zers think savings accounts are the best way to invest their money, while 46% of Baby Boomers say investing in stocks is a better option.

Different age groups have different struggles. 48% of Baby Boomers say inflation is holding them back more than their income, debt, and housing costs, compared to only 39% of Gen Zers.

Some young people lack budgets. Almost 30% of Gen Zers don’t have a budget for managing their monthly expenses.

Good examples are important. Over 34% of Gen Zers say their parents did not set a good example for them financially – more than any other generation.

Generations look to different sources of insight. While most Baby Boomers (60%) prefer a financial professional as their go-to source for financial advice, Gen Zers (39%) prefer a family member.

WalletHub Q&A

Why is Gen Z the least financially confident generation?

“Gen Z is the least confident generation when it comes to financial knowledge and skills, according to WalletHub’s Generational Finances Survey, in part because many people in Gen Z lack role models for good financial behavior. Over 34% of Gen Zers say their parents did not set a good example for them – more than any other generation,” said Cassandra Happe, WalletHub analyst. “Gen Zers are more likely to ask a family member or the internet for financial advice than a financial professional, which may put them on the wrong track when making decisions.”

What are the main factors holding Americans back from financial success?

“Unsurprisingly, inflation is the biggest factor people in every generation cite as holding them back from financial success, according to WalletHub’s latest survey,” said Cassandra Happe, WalletHub analyst. “Until the Federal Reserve is able to fully rein in inflation and bring it down to normal levels (around 2%), it will likely remain the biggest obstacle to success. All generations say their income is the second-biggest stumbling block, but when it comes to third place, Baby Boomers and Gen Z worry more about housing costs, while Gen X and Millennials are more concerned about debt.”

How do generations differ when it comes to investing their money?

“Every generation except Gen Z agrees that the stock market is the best place to invest their money. Members of Gen Z prefer savings accounts, WalletHub’s new survey found. Gen Z’s opinion is understandable given how attractive high-yield savings accounts and CDs have been recently, but investing in stocks or mutual funds still is key for long-term growth,” said Cassandra Happe, WalletHub analyst. “All generations view real estate as the third-best investing option, followed by bonds and then cryptocurrency. Baby Boomers and Gen Z both have very little interest in cryptocurrency, while Gen X and Millennials see it as almost as good of an investing vehicle as bonds.”