YLab’s Executive Director Brigid Canny joins dave to talk  about  major new research survey into the changing spending, savings and investment habits of Gen Zs and Millennials.

  • There is plenty of digestible data in the report, but a few key takeaways:
  • COVID-19 has accelerated a mammoth shift in the way young Australians think about spending, saving and investing their money
  • The ‘smashed-avo’ generation has transformed into a generation of thrifty and savvy spenders – and 81 percent are wanting to build a buffer for a rainy day and 82 percent wanting to live within their means
  • Changes brought on by COVID-19 include a shift to online shopping, being more careful about what they spend, increasingly shopping around for the best deals and putting away more savings for unexpected expenses or periods of financial hardship.
  • They are desperate for more financial knowledge and better financial literacy to help them manage today and save for tomorrow.

 

A dramatic shift in the way Millennials and Gen Zs spend, save and invest their money is underway –
accelerated by the financial stress brought on by the COVID-19 pandemic, according to a new
nationwide survey.
A new research report shows a shift towards more conservative financial attitudes, with around 80 per
cent of Australians aged 18-39 years agreeing it is important to live within your means and think
carefully about what you spend money on.
“Forget the ‘smashed-avo’ generation, this is now a generation of thrifty and savvy spenders who are
conscious about the need to plan for their financial futures, particularly in light of the economic strain
they’re under due to COVID-19 and other factors ,” said Brigid Canny, Executive Director of YLab – the
social enterprise arm of the Foundation for Young Australians.
“Despite what people say about the frivolous spending habits of young Australians, they’re actually
more financially mature and cautious about how they manage their money than they often get given
credit for.”
The research report – involving a mix of qualitative and quantitative surveys – was conducted by YLab
and 89 Degrees East, and funded by Afterpay.
Core findings of the report included:
● 82 percent of young Australians agree it is important to live within your means
● 81 percent are actively looking for ways to minimise expenses
● 81 percent think it is important to have a buffer for a rainy day, and
● 67 percent think they know how to have fun without spending too much.
The findings were amplified by the identification of six money ‘mindsets’ – with “Life Big Savers” and
“Work to Live” accounting for half of all participants.

“The common attribute to these mindsets is they represent people who are realistic, thrifty and savvy
when it comes to money – and keen to keep an eye on progress towards longer-term goals, despite
economic challenges they might face,” Ms Canny said.
In the wake of the COVID-19 pandemic, a quarter of Millennials (26-39 years) and Gen Zs (18-25 years)
are earning less than they were before and are changing their financial behaviours as a result. This
includes a shift to online shopping, being more careful about what they spend, increasingly shopping
around for the best deals and putting away more savings for unexpected expenses or periods of
financial hardship.
Young Australians are facing unprecedented financial circumstances in the wake of the COVID-19
pandemic, resulting in increased workforce casualisation, under-employment, stagnant wages growth
and decreased housing affordability.
“Young Australians are changing the way they spend, save and invest their money,” Ms Canny said.
“They have a real thirst for financial knowledge that will help them manage their finances today and set
themselves up for a secure future. They also want their views included in the design of financial systems
and supports.”
The Chief Executive of the Foundation for Young Australians, Nick Moraitis, said he hoped the research
findings were harnessed to spur greater support, guidance and opportunity for young Australians.
‘Young people are bearing the brunt of an economy that is currently stacked against them. This is why it
is essential we put young people’s voices at the centre when generating solutions, as well as continue to
advocate for structural changes that will enable young people to prepare for more equitable financial
futures,’ Mr Moraitis said.
The report shows the financial shock of COVID-19 is bringing the financial futures of young Australians
into focus, particularly for those receiving COVID-19 support. Three quarters say they want to put aside
an emergency savings fund as a buffer for any economic shocks yet to come.
“The COVID-19 pandemic won’t be the last economic shock young Australians face in their lives, and
they are realising now is the time to build knowledge, savings and financial security for the long-haul,”
Ms Canny said.
“Alongside young people needing access to different skill development opportunities we also need
sustained reform responses targeting the high levels of youth and un and underemployment. These
supports should be co-designed with young people to ensure they meet their needs. ‘

A copy of the report can be found here

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