Gen Z, Millennials, Gen X & Boomers Have Completely Different Ideas Of How To Spend Their Money
Vitaly Gariev | Pexels Financial values and spending habits are a hot topic right now, largely because of shifts around expenses and life milestones.
For young people, who are facing all sorts of financial barriers, their experience looks a whole lot different than it did for their Gen X and boomer peers at the same age. There's still tension between generations, which is why everyone needs to understand how Gen Z, millennials, Gen X, and boomers feel is the best way to spend their money.
Each generation has a completely different idea of how to spend money
Boomers are still frugal and prefer tangible, analog money habits
Despite being one of the, if not the most, financially secure generations, many boomers are still thrifty and appreciative of frugal habits and spending.
They use coupons and opt for loyalty programs. They hunt down the best prices for everyday expenses, choosing generic alternatives to brand-name goods.
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When it comes to managing their money, boomers also tend to appreciate much more hands-on, analog habits.
They request and go through paper bank statements and keep receipts. They use cash as a budgeting tactic and prefer analog financial habits over digital, more convenient alternatives.
They may be more willing to splurge on vacations and trips, but they value spending money frugally and making investments.
Gen X spends the most, largely on family and household responsibilities
At the intersection of aging parents and adult children, hence the name "the sandwich generation," Gen Xers often shape their spending depending on family obligations and responsibilities.
They're the biggest consumers of everyday goods and household services. But they have the disposable income right now to invest in those quality goods and high-end services.
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With the financial struggles that younger generations face today, the 75% of parents still supporting their kids in some way are largely Gen Xers.
Yes, they're investing in life milestones like mortgages and cars, but they're also mostly spending money on others and their families, more than older generations were at the same age.
Millennials spend more on life investments and debt, alongside internet expenses
Despite hanging on to many of the financially literate mindsets and habits of previous generations, many millennials feel like they're running out of money and falling behind on savings.
With most of their money going toward big investments and debt, they have much less disposable income to spend on services and small luxuries than their Gen X counterparts.
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The majority of millennials are spending 100% more on homes than their boomer counterparts, so they're feeling behind trying to keep up with traditional life events alongside expensive daily costs.
With the extra money they do have, millennials are interested in volume and budget spending. They're also huge drivers of comfort- and nostalgia-spending, whether it's on clothing or lifestyle upgrades.
Gen Z appreciates micro-experiences and sustainability, but they're cutting back
Despite being labeled as irresponsible spenders by many older generations, Gen Z is cutting back and saving more.
They're enjoying micro-experiences that older generations don't indulge in, like $7 lattes and casual restaurant outings as a form of community. But they're also pushing back the timelines of major lifestyle expenses, like purchasing a home or starting a family.
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Their priorities right now are building community and investing in brands that mirror their values of sustainability and inclusivity. They want to make their daily lives enjoyable, even if that means spending a little more than older generations would.
Despite many still living with less than $500 saved up, younger generations' reliance on parents for financial support is slowly trickling down.
Zayda Slabbekoorn is a senior editorial strategist with a bachelor's degree in social relations & policy and gender studies who focuses on psychology, relationships, self-help, and human interest stories.
