The vast majority of Zoomers are supported by subsidies from their families.
A staggering 46% of Gen Zers rely on extended family for financial help, according to a new survey released this week by Bank of America.
“Parent TrapEarlier this year, research firm Gen Z Research Center surveyed more than 1,000 Gen Zers (currently defined as those aged 18 to 27) and found that more than half (52%) said they don’t earn enough to live the lifestyle they want, with respondents most strongly citing the current high cost of living as the reason for this situation.
As a result, many young people continue to rely on their parents’ banks well into adulthood, with 54% of those surveyed admitting that they don’t pay their own housing costs. Meanwhile, Gen Zers who do pay their own housing costs say it consumes most of their income, with 64% reporting that they spend more than 30% of their monthly salary on housing.
In response, many teens and people in their late teens and 20s have turned to what’s known as “loud budgeting” — saying out loud how much they can realistically spend while socializing with friends. It’s proven to be such an effective budgeting strategy that a Bank of America study found that “Generation Z may set stricter financial boundaries than others their age.”
In fact, dealing with tough real estate and economic realities has forced Zoomers to impose significant financial restrictions to offset rising expenses through lifestyle changes, including eating out less (43% say they are doing this), turning down invitations to friend events (27%) and shopping less frequently at pricey grocery stores (24%).
“Despite facing obstacles from the rising cost of living, younger Americans are demonstrating discipline and foresight in their savings and spending patterns,” said Holly O’Neill, president of retail banking at Bank of America, adding that “it’s important we continue to help Gen Z achieve financial wellness and reach their long-term goals.”
