Gen Z Finances & Financial Wellness in the Workplace

Having just entered the workforce, much is still unknown about Gen Z and the exact role they will play in the economy as they begin to dominate the conversation – by 2034, they will represent America’s largest generation demographically. What tie do Gen Z finances and financial wellness play in the workplace?

While they share many traits with Millennials, Gen Z has entered the workforce in a much stronger job market, not having to bear the brunt of the 2008 financial crisis. However, the impact of the COVID-19 pandemic is yet unclear as to how it will impact the generation’s future – a Pew research study concluded that nearly half have reported a loss of income in their household due to the fallout.

With uncertainties in tow, what are the most pressing financial questions on the minds of our youngest workers? In this article, we consider the driving forces in Gen Z finances, and how employers can help give them a leg up as they build into the foundation of the modern workplace.

Gen Z Finances: Concerns and Considerations

Stress

According to a report by Pew Research, Gen Z spends a large portion of their paycheck on eating out, spending time on their smartphones, and attending events that interest them. They are also one of the most stressed generations yet. 64% of Gen Z individuals report money and work to be significant stressors in their lives, with personal debt being one of the leading contributors.

Financial wellness is a concern that is universal among Americans – our research indicates that 88% of people report varying levels of stress over money, with the most stressed reporting a loss of productivity in the workplace. Financial wellness programs have been shown to improve productivity two hours per employee per week on average by diminishing time in which employees are stressed about their finances, dramatically decreasing healthcare spending.

As more Gen Z workers arrive in the workplace, providing them with tools and money coaching can serve as an invaluable opportunity. Being one of the most technologically savvy generations (with many not remembering a time before smart devices and social media), they are uniquely equipped to take advantage of budgeting apps and online learning on topics like savings, investments, and retirement. A good financial wellness program like My Secure Advantage has a wide variety of online resources that can help them meet their financial objectives.

College Loans

Gen Z is currently one of the most educated demographics of all time. According to Pew Research they have the highest high school graduation rates, and nearly 6 in 10 Gen Z students between 18 and 21 are currently in college.

With rates of education even higher than millennials, student loans and debt will likely play a pivotal role in their adult lives.

Many older millennials have gone on the record about how paying off student loans have delayed purchasing a home, building emergency savings, and contributing to their retirement funds. While college education has given them the tools to find better paying jobs, their lifestyles have been set back by not being able to make headway on debt payoff

Educating and coaching Gen Z workers on paying off existing debts could give them greater freedom to make the financial decisions they want. Providing insight around these topics is of great benefit to this generation as they explore what the future has to offer them.

Home Ownership

The overwhelming majority of Gen Z individuals want to be homeowners at some point in their futures. But between financial stress and crippling loans, it may be some time before they will be financially ready to start purchasing homes.

While home ownership may still be in the distance for the majority of Gen Z, it remains a goal for many of them in spite of the obstacles set in front of them. Offering education around topics such as mortgages and savings can help them turn these dreams into a reality.

My Secure Advantage Addresses Gen Z Financial Concerns

As indicated by Pew Research, Gen Z is more diverse, more educated, and more stressed than ever before, and determined to make an impact in the American workplace.

My Secure Advantage offers a suite of tools designed to engage with Gen Z and build strong futures. Gen Z seeks education – with live coaching, webinars, and online tutorials, you can ensure the youngest members of your team stay ahead and stay productive as vital members of your team.
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Sources Cited:

1. “Large Number of Americans Reported Financial Anxiety and Stress Even Before the Pandemic.” FINRA, 28 Apr. 2021, www.finra.org/media-center/newsreleases/2021/large-number-americans-reported-financial-anxiety-and-stress-even.
2. Hess, Abigail Johnson. “More than Half of Older Millennials with Student Debt Say Their Loans Weren’t Worth It.” CNBC, 8 Apr. 2021, www.cnbc.com/2021/04/08/older-millennials-with-student-debt-say-their-loans-werent-worth-it.html.
3. Passy, Jacob. “Watch Out, Millennials — Generation Z Is Poised to Dominate Home Ownership.” MarketWatch, www.marketwatch.com/story/watch-out-millennials-generation-z-is-poised-to-dominate-homeownership-2019-12-19. Accessed 8 Sept. 2021.