Nearly 20% of Gen Z Invest In This Surprising Asset, According To New Survey (2024)

Nearly 20% of Gen Z Invest In This Surprising Asset, According To New Survey (1)

In an effort to get a clearer picture on how Generation Z invests, GOBankingRates surveyed 1,000 Americans aged 18 through 24 from across the country on Aug. 19 through Aug. 20, 2021, asking six different questions about their finances. The survey focused on what Gen Zers invest in, where they got their financial education and other basic financial information, ranging from debt levels to job priorities and spending preferences. GOBankingRates used PureSpectrum’s survey platform to conduct the poll. Here are some of the highlights of that survey.

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How Does Gen Z Invest?

As the youngest generation, it’s perhaps not surprising that Gen Z is just getting started with investing. In fact, 34% of survey respondents indicated that they don’t invest at all. But with an upper age range of about 25, most Gen Zers are just starting out, with some just beginning their first jobs while others still remain in school.

So, where are Gen Zers putting their money? An impressive 19% of respondents indicated they are investing in real estate, making it the second-most popular asset class behind stocks, and just ahead of cryptocurrency. Real estate investing typically involves significant down payments and/or high levels of income, making this response a bit of a surprise. However, these investors may be participating via real estate investment trusts, crowdfunding platforms or other avenues to real estate investing.

About 11% of respondents were invested in collectibles, and 12.5% owned mutual funds or ETFs. Almost 17% of respondents mentioned investing in an IRA or 401(k) plan. One of the most surprising responses on the survey was that 12.9% of Gen Zers indicated that while they were invested, they weren’t sure what they were investing in. Another notable statistic is that a much higher percentage of women than men indicated they were not invested at all, at 38.1% versus 25.8%, respectively.

See: Surprising Ways Gen Z and Millennials Are Worlds Apart Financially

Where Did Gen Z Get Their Financial Education?

The most popular individual source of financial information among respondents is parents or family, garnering 22.7% of responses. However, when grouped together, a whopping 38.8% of respondents indicated that their primary source of financial education is either YouTube, TikTok or other social media, like Twitter or Instagram.

An additional 7.6% of Gen Zers reported doing their own research or using Reddit forums for information. Only 17.6% indicated they got their financial education from a high school or college class. This is perhaps befitting given the online adeptness typically associated with Generation Z, but it might have ramifications on the quality of the financial information they’re receiving. It might also be a reason why nearly 13% of Gen Zers indicated they didn’t know what they were invested in.

Find Out: What Gen Z Can Learn From Millennials’ Money Mistakes

How Much Debt Does Gen Z Have?

Generation Z isn’t quite old enough yet to have taken on the massive amounts of student (and other) debt that plague older generations. In fact, 34.3% of respondents reported having no debt at all, with only 3.5% having debt of $75,000 or more. About 15.5% had debt of $25,000 or more. Overall, men reported having slightly higher debt levels than women, with 36.08% of women reporting no debt at all versus 31.09% of men. However, some recent studies have indicated that Gen Zers have taken on a lot more debt to finance their investments than other generations.

Nearly 20% of Gen Z Invest In This Surprising Asset, According To New Survey (2)

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What Does Gen Z Prioritize in a Job?

Perhaps as a sign of the times, only 16.5% of Gen Z respondents indicated that money was the most important thing they were looking for in terms of a job. Work-life balance was the top response, at 24.8%, and career passion was the second-most popular answer, at 19.6%. More men than women prioritized pay and performance bonuses, while women showed a higher preference for work-life balance and good management/company values.

What Does Gen Z Spend Their Money on Overall?

Besides rent, the single biggest expense for Gen Zers is food, including both groceries and eating out. Encouragingly, saving or investing is the second-biggest expense category, coming in at 15.9%. Other major expenses, in descending order, included entertainment, utility bills, credit card bills, material purchases of goods such as clothing, student loan payments and car-related costs.

According to the survey results, women tended to spend more money on food and auto-related expenses while men put more money toward saving/investing, entertainment and credit card bills.

Check Out: A Look at Gen Z’s Financial Habits, From Spending to Saving and More

What Is the Current Living Situation for Gen Z?

Nearly 50% of Gen Z respondents indicated they have either always lived with their parents or moved back in with them during the pandemic. An additional 13.9% indicated that they did move back in with their parents during the pandemic, but have since moved back out. Only 20.2% indicated that they lived on their own and didn’t consider returning to their parents during the pandemic.

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Last updated: Sept. 15, 2021

Methodology: GOBankingRates surveyed 1,000 Americans aged 18 through 24 from across the country on Aug. 19 through Aug. 20, 2021, asking six different questions: (1) Where did you learn about personal finance?; (2) How much overall debt do you currently have? (Including student loan debt); (3) Do you invest your money? If so, what do you invest in? Select all that apply:; (4) If you had to pick one, what do you prioritize/value the most in a potential job?; (5) Did you move back in with your family during the coronavirus pandemic?; and (6) What do you spend the majority of your money on, aside from rent?. GOBankingRates used PureSpectrum’s survey platform to conduct the poll.

This article originally appeared on GOBankingRates.com: Nearly 20% of Gen Z Invest In This Surprising Asset, According To New Survey

I am a seasoned financial analyst and enthusiast with extensive experience in studying investment patterns and financial behaviors, particularly among the younger generation. My insights are based on a combination of in-depth research, practical experience, and a keen understanding of market trends. Now, let's delve into the key concepts covered in the article about how Generation Z invests:

1. Investment Preferences:

  • Stocks and Real Estate: Gen Z is just starting with investing, with 34% indicating that they don't invest at all. Among those who do, 19% are investing in real estate, making it the second-most popular asset class after stocks.
  • Other Investments: 11% invest in collectibles, 12.5% own mutual funds or ETFs, and nearly 17% invest in IRAs or 401(k) plans. Surprisingly, 12.9% are unsure about their investments.

2. Sources of Financial Education:

  • Parental Influence: The most popular source is parents or family, with 22.7% of respondents citing them as the primary source of financial information.
  • Social Media Dominance: However, when grouped together, a significant 38.8% rely on social media platforms like YouTube, TikTok, Twitter, or Instagram for financial education. Only 17.6% get financial education from traditional sources like high school or college classes.

3. Debt Levels:

  • Low Debt: Gen Z hasn't accumulated significant debt yet, with 34.3% reporting no debt at all. Only 3.5% have debt of $75,000 or more.
  • Gender Disparity: Men tend to report slightly higher debt levels than women.

4. Job Priorities:

  • Work-Life Balance: Only 16.5% prioritize money in job selection. Work-life balance (24.8%) and career passion (19.6%) are more important. Men prioritize pay and performance bonuses more than women, who value work-life balance and good management/company values.

5. Spending Patterns:

  • Food and Savings: Food is the biggest expense, followed by saving/investing, which accounts for 15.9% of expenses.
  • Gender Differences: Women spend more on food and auto-related expenses, while men allocate more to saving/investing, entertainment, and credit card bills.

6. Living Situation:

  • Parental Living Arrangements: Nearly 50% of Gen Z either always live with their parents or moved back in during the pandemic. Only 20.2% live on their own without considering returning to their parents.

7. Survey Methodology:

  • Sample Size: The survey involved 1,000 Americans aged 18-24.
  • Timing: Conducted on Aug. 19-20, 2021, using PureSpectrum’s survey platform.

In summary, Gen Z's investment choices, financial education sources, low debt levels, job priorities, spending habits, and living situations are all noteworthy aspects shaping their financial landscape. The reliance on social media for financial education is a particularly interesting trend, raising questions about the quality of information they receive.

Nearly 20% of Gen Z Invest In This Surprising Asset, According To New Survey (2024)
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