Less accumulation, more experience
Looking at social media, many people often think that Gen Z (young people born between 1997 and 2012) seems to be spending too much on trips or fancy meals. But behind those “sparkling” photos is a meticulous financial strategy, with a clear spending spreadsheet and savings plan.
According to the Prosperity Index Report (also known as the Prosperity Index Report) published by global financial technology platform Intuit in 2023, Generation Z has been focusing on building financial plans following the "soft saving" trend.
Soft savings is a trend of more flexible financial management in saving, when Gen Z prioritizes choosing to enjoy life and invest in themselves at the present time instead of spending all their income on accumulating long-term assets.
“Soft saving” - Gen Z's intentional spending mindset (Photo: Getty).
Unlike previous generations who often followed the model of "earn, save and retire", Gen Z today prioritizes more short-term goals such as travel experiences, learning more skills... to enjoy the things they want more fully.
According to the report, 73% of Gen Zers said they would rather invest in a better quality of life now than keep money in a bank account.
A Morning Consult survey found that a significant proportion of Gen Zers travel quite frequently, averaging three trips per year, despite 60% earning less than $50,000 per year. The secret to their ability to manage a limited budget lies in their extremely intentional approach to spending.
Another study from McKinsey’s ConsumerWise group in late May found that most young people today spend more intentionally than previous generations. They don’t spend on impulse, but instead set up savings funds for both the future and current experiences.
Many young people today proactively open high-interest savings accounts, taking advantage of loyalty incentives such as converting credit card points to save on travel expenses and other living needs.
Spend purposefully, don't live in a hurry
Kevin Droniak, 28, lives in a small apartment in New York and does everything he can to keep his daily living expenses to a minimum. To prepare for his financial future, he plans to save at least $20,000 a year for retirement.
However, Droniak still budgets for short trips to Colombia, Egypt or Europe. He sees travel as a necessity, not a hobby or a desire.
For each trip, he budgets between $500 and $1,000, along with a carefully calculated travel budget. Droniak takes advantage of cheap transportation like the subway or walking, tries local eateries, and looks for free tourist activities wherever he goes.
Qistina, a Gen Zer, doesn’t mind spending money on parties, trips around Sydney, or trips with friends to Dubai and Paris. She divides her income into two parts, a high-interest savings account and a separate fund for personal needs such as travel and entertainment.
Gen Z spends purposefully and carefully (Photo: Getty).
However, every trip is carefully calculated. Before booking a ticket, Qistina always compares thousands of options in terms of flights, airlines, destinations and times to ensure the most reasonable spending.
Qistina says that many people often overlook small daily expenses, like eating out frequently or buying expensive coffee, but these seemingly insignificant expenses add up and make them feel like they can't afford bigger goals, like traveling.
According to Ms. Heather Leisman, President of EF Ultimate Break travel agency, which specializes in serving 18-35 year olds, a new generation of tourists is prioritizing the value of experiences instead of just paying attention to cost.
“Gen Z looks at value, not just the number on the bill,” she says. They still care about affordability, but the way they budget has changed. Gen Z opts for shorter trips, hunts for deals, prioritizes off-season or budget-friendly, low-cost destinations.
Andy Reed, a behavioral finance expert at Vanguard, said Gen Z always plans spending with purpose instead of "spending money" spontaneously.
"As long as they can cover basic expenses like housing and food, they are willing to invest in experiences - things that bring long-term emotional value," said Andy Reed.
Source: https://dantri.com.vn/kinh-doanh/hieu-the-nao-ve-cach-tiet-kiem-mem-cua-gen-z-20250714084708762.htm
Comment (0)