Gen Z’s Worries: Affording College, Carrying Student Debt

“Increased tuition costs and a bleak job outlook may be a cause for concern to some Gen Z teenagers, young adults and their parents, but being proactive and coming up with a savings strategy early on can help ease some of these financial anxieties,” said Carrie Braxdale, managing director, investor services, in a statement. 

While 75% of Gen Z said saving money is important, and 41% said they have a budget and follow it closely, this generation is also showing signs of developing early bad financial habits. Among those Gen Z respondents who have a credit card, more than half (56%) have carried a balance for six months or longer (only 23% pay it off each month). Additionally, 23% of 19- to 22-year-olds and 41% of 16- to 18 year-olds say they do not have either a checking or savings account.

TD says that members of Gen Z who had experience with more financial products were found to be better budgeters, and on average those good budgeters had $850 more socked away in savings than those who didn’t budget as well ($950 vs. $100 saved).

Furthermore, the study found that one of the most common denominators for good budgeters was having had extensive discussions with their parents about saving money (67%) compared to those that aren’t good budgeters (34%).

“We found that parents are still the most influential variable when it comes to educating children on basic financial skills,” Braxdale said. “Parents who work with their children early to develop a financial plan and clearly set financial expectations can help better prepare them for financial success later in life.”