Gen Z is facing a tougher financial situation than millennials did a decade ago at the same age.
Key Findings:
Lower Income: Gen Z (ages 22-24) is earning an average of $45,493, while millennials at the same age were making $51,825 (adjusted for inflation).
Higher Debt-to-Income Ratio: Gen Z has a debt-to-income ratio of 16.05%, compared to 11.76% for millennials.
Increased Financial Stress: 14% of Gen Z respondents report feeling "extremely stressed out" about their finances, compared to 8% of millennials a decade ago.
Credit Card Reliance: Gen Z relies more on credit cards than millennials did at the same age, with 84% of Gen Z having at least one credit card compared to 61% of millennials.
Reasons for the Disparity:
High Inflation: Gen Z has entered the workforce during a period of high inflation, which has significantly increased the cost of living.
Lower Salaries: Gen Z is starting their careers with lower salaries compared to millennials at the same age.
Student Loan Debt: While not explicitly mentioned in the article, student loan debt is a major contributor to financial stress among young adults.
Implications:
Financial Challenges: Gen Z is facing greater financial challenges than previous generations, leading to increased stress and reliance on credit.
Economic Outlook: The high inflation and economic uncertainty are likely to continue impacting Gen Z's financial well-being.
Changing Financial Habits: Gen Z may need to adopt different financial strategies than previous generations to navigate these challenges.
Important Note: This study focuses on a specific age range (22-24) and may not be representative of the entire Gen Z population. Further research is needed to understand the full extent of Gen Z's financial challenges and how they compare to previous generations throughout their careers.
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