Spending habits among younger generations, especially related to platforms like TikTok Shop, can reflect some serious financial challenges. It’s like, in a way, they’re choosing to skip meals just to afford the latest trends or, well, the essentials.
According to new findings from the Payroll Integrated 2025 Employee Financial Wellness report, a significant portion of employees across generations is withdrawing funds from their retirement accounts, with Gen Z leading the pack. Nearly half of these young adults are already engaging with retirement savings, a notable contrast to just 31% of millennials. Interestingly, both Boomers and Gen X sit at 41%.
What stands out, though, is that many aren’t pulling money for cool experiences; rather, they’re trying to dodge overwhelming debt. About 37% of early withdrawals across all age groups stemmed from emergency situations. For Gen Z, it’s even more pronounced—42% tapped into their accounts specifically to settle debts. In contrast, only 6% of millennials, 17% of Gen X, and none of the Boomers reported the same motivation.
But it’s not just savings they’re depleting. A separate study from Redfin indicates that Gen Z is also making some tough sacrifices, such as skipping meals and postponing doctor visits just to manage rent payments. Over one in five young renters (22%) are entirely skipping meals to cover these costs, while others report selling possession or delaying essential medical care.
Gen Z Debt Troubles: Student Loans and Credit Card Issues
The financial struggles for Gen Z can partly be attributed to a lack of understanding of money management. They’re saving more for retirement than their parents did at their age, but the high cost of living forces them to pull resources from vital areas of life. Young adults face not only steep housing prices but also hefty student loans and credit card bills.
Research indicates that Gen Z members are paying an average of $526 monthly just for student loans—almost double the average of $284 for all age groups. They also carry more than $94,000 in personal debt, which shoots far above the nearly $60,000 that millennials and the about $53,000 that Gen X manage.
Natalia Brown, the Chief Compliance and Consumer Affairs Director for National Debt Relief, pointed out that many in this generation feel overwhelmed by financial burdens as they start their careers. The weight of this debt can be particularly heavy for them due to their circumstances.
Despite a slight improvement in inflation since its peak in 2022, many young adults are still struggling. A report from Zillow revealed that homebuyers now need to earn 80% more compared to 2020, while median incomes have only risen by about 23% during the same period.
As they navigate today’s economy, many young adults rely on credit cards for everyday expenses and experiences. However, without solid financial literacy or consistent income, managing credit card bills can become increasingly challenging. Data from Experian shows that the average credit card balance for this demographic sits at $3,262.
