Generation Z adults appear to be more financially sophisticated than any previous generation was at their age, according to The 2022 Investopedia Financial Literacy Survey. But they also have the most to learn. Here are some insights from the survey.

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More than half of Gen Z adults are already invested—with 26% of that group invested in the st𓆏ock market—yet only 1 in 4 fe🐲el they understand the stock market well enough to explain how it works to a friend. Of all financial concepts, they feel most confident about spending and saving. 

💜As 23-year-old financial advisor , whose firm Ascent Personal Finance specializes in providing advice for millennial and Gen Z cr🍰ypto investors, puts it: “They know lots of things about finance loosely, but they don’t know a lot of things deeply.” 

Take Megan Rienzo, for example. The 20-year-old Siena College sophomore, who is on track to receive a degree in finance, keeps meticulous 澳洲幸运5开奖号码历史查询:track of her spending and savings by using a smartphone app. Through her courses in finance, she has learned how to value stocks💞 and feels strongly about investing b๊ut still finds it too complex and risky for where she currently is financially to actually start.

I🌼n short, the financial picture for Gen Zers older🌌 than 18 is a study in contrasts. 

Finding Their Financial Footing

It takes a very self-aware generation to know what they don’t know. And members of Gen Z who took part in The 2022 Investopedia Financial Literacy Survey, which polled 4,000 U.S. adults via an online questionnaire, understand that they are only at the beginning of 澳洲幸运5开奖号码历史查询:their journ🐼ey to financial independence. 

Only 46% of Gen Z feel confident about their financial knowledge, for instance, which is a lower percentage than baby boomers, Gen X, and 澳洲幸运5开奖号码历史查询:millennials who said the same. Part of the reason why could be that, in 2022, there are so many places for people to consume information—think YouTube, podcasts, and TikTok, in addition to traditional news articles.

“There’s so m๊uch information available that it’s harder 📖to know what to look for,” Rienzo said.

Gen Z doesn’t lack confidence 澳洲幸运5开奖号码历史查询:when it comes to spending and saving, however. Forty-five percent of those polled claim to have🍌 advanced knowledge of spending, while 42% said the saܫme about saving.

Schaefer notes that the zealous spending and saving habits of Gen Z (and his clients specificall꧒y) can be attributed to them watching their parents struggle with mortgage, credit card, and other debt. Some clients, Schaefer said, feel increased pressure to save due to the debt they themselv🍨es face from student loans.

All in on Investing

was first introduced to investing when he was 8 years old and his grandfather set up an investment portfolio for him. In high school, he went on to start the Young Investors Club, LLC—a fund designed for teens to invest in the stock market that now has about 100 members and more than $100,000 assets under management. He’s also the author of several books, each of which serves as a how-to to investing for teens. He’s 19 years old.

Rosenthal is the ultimate personification of Gen Z’s enthusiasm for investing. Fifty-four percent of 澳洲幸运5开奖号码历史查询:Gen Z hold some kind of investment, according to Investopedia’s survey, ranging from mutual funds and 澳洲幸运5开奖号码历史查询:exchange-traded funds (ETFs) to cryptocurrencies and non-fungible tokens 🤡(NF♉Ts). 

Moreover, everyone seems to be getting in on the action in some shape or form. Forty-eight percent of Gen Z women in our survey hold investments, versus 60% of Gen Z men, for instance. And in general, 45% of those earn🐭ing less than 🦄$50,000 per year are investing, compared to 73% of those earning more than $50,000.

“Because of social media, Gen Z knows more about investing at their age than any other previous generation,” Rosenthal said. He also notes that changes in the regulatory environment, such as allowing teenagers to have 澳洲幸运5开奖号码历史查询:parentally supervised accounts, have opened the door to the stock market.

Emerging financial technologies are particularly popular with Gen Z. About a quarter of Gen Z investors hold both cryptocurrencies and stocks, and one in 10 own NFTs. Men in particular own cryptocurrencies and🧜 NFTs at a rate that nearly doubles that of women. But despite their mass involvement in this market, Gen Z admits cryptocurrency in particular is last on their list of financial knowledge. 

That’s a recipe for trouble,ಌ accorওding to Schaefer. 

“You hear about people making money in crypto and NFTs and feel confident and want to go for it,” Schaefer said. “And before you know it, you’ve 澳洲幸运5开奖号码历史查询:taken on too much risk and are overextended.” 

Watch and Learn

Gen Z is the first generation to grow up with smartphones and social media as part of daily life. They came of age with YouTube, Facebook, and the iPhone. And today, the youngest population spends about 6.5 hours on their smartphones per day.

But Gen Z isn’t just looking for entertainment—they are looking for information. According to digital education company Pearson, YouTube and video in general are Gen Z's preferred learning platforms, ranking second only to teachers as a learning tool.

According to Investopedia’s survey, Gen Z is the most video-forward generation when it comes to learning about personal finance in particular. YouTube is the most popular source for consuming finance-related information at 45%, followed by conversations with friends and family, Internet search, TikTok, and financial information sites.

The sheer volume of money-related advice on social media—from self-proclaimed finance experts on TikTok to Reddit forums like 澳洲幸运5开奖号码历史查询:WallStreetBets—makes proper vetting a daunting pr𒉰ospect. After all, there is no credential requirement for what one plans to say on Instagram or any other social platform. 

“The personalities and charisma of some of the people on these platforms😼 makes it easy to forget that personal finance is indeed personal,” Schaefer said. 

Yet there’s no denying that video and social media have democratized access to financial information. What used to be a scarce asset reserved for only those wealthy enough to pay for it, is now—thanks to digital media—an abundant resource for all. With that access comes responsibility, however, such as conducting your own research before taking investment advice and doing a background check on the source p🦩roviding the information.  

Cause for Concern

When asked about their personal finance knowledge, Gen Z is specifically concerned about taxes. 澳洲幸运5开奖号码历史查询:Paying taxes ranks as their second biggest concern and the No.1 skill they’d like to learn, according to Investopedia’s su💖rvey. The other big concerns for Gen Z are saving, borrowing, and managing debt🐻. 

The financial behavior of Gen Z can be traced in part to the global COVID-19 pandemic. Members of this generation were among the most impacted, according to a study conducted by the ADP Research Institute. Seventy-eight percent of Gen Zers found their personal lives were affected, while 39% say they lost their jobs, were furloughed, or faced a temporary layoff.

꧙ Below, take a closer 👍look at Gen Z’s biggest concerns.

Taxes

The lower the income, The 2022 Investopedia Financial Literacy Survey shows, the more interest Gen Zers have in learning about taxes. Thirty-seven percent of Gen Zer𓆏s who make less than $50,000 cited “how to do my taxes” as the skill they’d most like to lear꧒n, versus 31% for those making more than $50,000. 

One factor that has been suggested as a possible explanation for Gen Z’s focus on taxes is the general belief that the 澳洲幸运5开奖号码历史查询:Social Security net will run out. Nearly one-fifth (19%) of people say it’s not at all likely that Social Security will be available to them 澳洲幸运5开奖号码历史查询:when they retire, and 43% say they can imagine a time when Social Security no longer exists.

Another factor, according to Schaefer, could be that, amid the 澳洲幸运5开奖号码历史查询:gig economy, there are more self-employed or entrepreneurial-minded Gen Zers wanting to start their own businesses, which can create complicated tax scenarios.

Debt

Those of Gen Z who make less than $50,000 annually are more worried about saving and i💟mproving their credit score than those making more than ♛$50,000.

And this data matches the reality of debt younger adults face today. In 2020, both millennials and Gen Z saw the greatest overall debt growth, with Gen Z seeing the largest growth across mortgage and personal loan debt specifically, according to Experian’s consumer debt research.

Investing and Managing Risk

Even though more than half of 澳洲幸运5开奖号码历史ꩵ查询:Gen Z is already inve💮sted in the stock market, investing and 澳洲幸运5开奖号码历史查询:managing risk are among their least unders♌tood aspects of finance. Thirty-two percent of Gen Z cite being afraid to lose money as holding them back from investing, for instaꦐnce, while 22% of those who are not invested say it’s because they don't trust the market. 

Rosenthal, the teen investing guru, suggests that the fear of risk is socioeconomic. More specifically, stock market volatility over the past decade resulting from such things as the popularity of retail inve⛦sting, the war on terror, and digital disruption has made investing scary for some ജof Gen Z. 

“Massive swings in the stock𒈔 market create fear, and that’s the only market this generation has known,” Rosenthal said. 

If fear isn’t keeping them from investing, it’s confusion. The explosion of financial products and services aimed at simplifying the investing process for young investors has instead made it appear more complex. Forꦍty-four percent of Gen Z who are not investing say it’s💎 because they don’t know where to start, making it the most popular reason for staying on the sidelines. Moreover, 40% of Gen Z crypto investors say they don’t really understand crypto. Or, as Rienzo put it, “I know that Bitcoin is a thing, but I’m not sure what kind of thing exactly.”

What Does Generation Z Need?

Overall, Gen Z is far ahead of where previous🀅 generations were at their age when it comes to financial literacy. If anything, though, they may be moving too fast and too much on their own. 

According to Schaefer, the abundance of information available can lead to a false sense of security. “You can find anything you want about a financial plan on Googl𓆉e, but Google can’t make you a personal financial plan,” he said. “My advice would be to slow down, figure out where you are, and get help developing a plan for where you want to go.”

The Bottom Line

The 2022 Investopedia Financial Literacy Survey quantifies U.S. adults’ understanding of their own financial literacy at the generational level. The survey was fielded via an opt-in, online self-administered questionnaire between Jan. 27 through Feb. 7, 2022, to 4,000 U.S. adults, 1,000 each of which were from the following generations: Generation Z (18-25), millennials (26-41), Generation X (42-57), and baby boomers (58-76). Quotas and data weighting were used to ensure race/ethnicity, gender, regional, and income representation among the total and within each generation. To learn more, see the 澳洲幸运5开奖号码历史查询:full methodology. 

Survey research and data analysis led by 澳洲幸运5开奖号码历史查询:Amanda Morelli.