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Inflation Is Throwing Hands And Gen Z’s Are Catching Them

By Claire Moraa

  • 90% of Gen Z’s are worried about their financial situation due to high inflation rates, a situation unfamiliar to their predecessors in their age group
  • There are at least 8.9 million Black Gen Z in America who are part of an important cohort as they transition to adulthood

Members of the Generation Z demographic, which typically refers to those born between the late 1990s and early 2010s, are experiencing the negative impact of inflation. Gen Z are facing the challenges of high inflation as they are entering adulthood. This significant increase in prices comes at a time when many individuals from this generation are graduating from college, moving out on their own, and starting their careers, making it even more difficult to manage their finances effectively. The situation is dire that at least 90% of Gen Z’s are worried about their financial situation.

Why This Matters: Research has shown that individuals in their early 20s, which includes many Gen Z members, are earning less, accumulating more debt, and experiencing higher levels of delinquency. Major expenses for Gen Z, such as rent, food, gas, and tuition, are rising rapidly amid the current inflationary environment. This surge in prices affects the everyday purchasing power of Generation Z individuals, making it challenging for them to afford necessities and manage their budgets effectively. The combination of lower income and higher debt burdens exacerbates the financial strain caused by inflation.

Basic necessities like shelter are increasingly becoming a distant dream for Gen Z. While 63% expressed interest in owing a home someday, only 4% of homebuyers are of this group. While their priorities may be on the right track, they face a lot of challenges. This misalignment between aspiration and reality, especially when it comes to something as fundamental as owning a home can make the dream of homeownership seem like an elusive goal rather than a tangible possibility.

But it’s not a lack of will. 63% of Gen Z believe in achieving financial success. However, Black consumers have been misrepresented by brands and the media which perpetuates inaccurate perceptions. When Black Gen Z individuals feel misrepresented or underrepresented in media, it can impact their purchasing decisions and economic power. If media portrayals reinforce negative stereotypes or limited narratives about Black individuals, it can contribute to systemic barriers in education, employment, and wealth accumulation.

Situational Awareness: The economic landscape may not be favorable for Gen Zs. And the media portrayals that fail to resonate with their experiences or aspirations are not helping. Adjustments to consumption patterns and lifestyle choices can be a start to create a savings fund. But remember, you cannot save in a hostile economy. Poor people are too busy trying not to be poor. They don’t have time for investments. There needs to be policies that address the root causes of inflation such as income inequality, housing affordability and access to education. Gen Z on the other hand should consider pursuing education or training in high-growth industries, acquiring transferable skills, and staying adaptable in a rapidly evolving economy.

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