Following on their “Lost Generation” research, published in 2022, the Financial Services Council set out to understand how the rising cost of living is affecting young New Zealanders.
So, here are some key insights from the FSC’s latest report*, “Money & You, Young People and the Cost of Living”.
Mental health is their top priority
The research confirmed, once again, the link between financial and mental well-being. As data shows, 73% of Gen-Zers surveyed said that financial issues have adversely impacted their mental health, and 68% of all respondents reported that financial issues affected their overall health.
According to the report, for young people, keeping their mental well-being in check is the number-one health priority. And, unfortunately, they’re feeling the money stress more than older generations. 78% of Gen-Zers worry about money on the regular – way more than the 43% of Baby Boomers who feel the same.
Personal debt can become an issue
When it comes to debt, Gen Z and Millennials have their own set of challenges. The report shows that 40% of young respondents were struggling with personal loans and buy-now-pay-later options. On the flipside, they had fewer issues than older generations with credit card debt.
Not prepared for a rainy day
Half of Gen-Zers and Millennials surveyed would be unable to access $5,000 in the event of a financial emergency. And 35% of Gen-Zers said they couldn’t keep up their lifestyle for even a month if their income stopped.
This is exactly why personal insurance is often worth considering. While younger generations may have fewer financial commitments (like mortgages, or people depending on them), everyone needs a safety net – just in case. If you’d like to explore your insurance options, get in touch: we can help you find ways to stay financially strong, no matter what life throws at you.
Not thinking about the long term
As many as 74% of Gen-Zers and 61% of Millennials surveyed haven’t started to think about what they’ll need to save for retirement. Of course, it’s way off in the future. But the reality is that, the earlier people start saving, the more they can benefit from the power of compounding returns. This means you can earn returns not just on your initial investment, but also on the accumulated returns from previous periods.
Confident in work, not so much in money
Another interesting finding is that 72% of respondents under 30s feel confident about making career choices. But when it comes to money? Not so much. Only 54% feel confident choosing insurance, 40% in picking investments, and 41% in planning for retirement. That’s where a friendly financial adviser (like us!) comes in: if you’d like to take control of your financial future through complex decisions, keep us in mind.
We’re here to help
If any of these findings prompted a question or two about your own financial situation, please don’t hesitate to get in touch. As financial advisers, we have been helping people from all walks of life achieve financial security and peace of mind.
*Methodology: The research was conducted via an online survey between 15 April and 26 April 2021 (2,035 valid complete responses), between 25 January and 31 January 2022 (2,000 valid complete responses collected), and between 7 March and 12 March 2023 (2,030 valid complete responses collected).
Disclaimer: Please note that the content provided in this article is intended as an overview and as general information only. While care is taken to ensure accuracy and reliability, the information provided is subject to continuous change and may not reflect current developments or address your situation. Before making any decisions based on the information provided in this article, please use your discretion and seek independent guidance.
