Gen Z: Savers instead of materialists - a rethink in financial planning?

Gen Z: Savers instead of materialists - a rethink in financial planning?

According to a report by www.merkur.de,

Consuming less and saving and investing instead? The younger generation is more responsible with money than perhaps expected. The young generation is often criticized for their lack of foresight. It wants to be lived in the here and now, without worries about the future. This is shown, among other things, by social media trends such as the “Girl Math” phenomenon, in which primarily young women gloss over their expenses.

With their savings behavior, the German representatives of Generation Z have been able to fight their way into the top five in a country comparison in recent years. At least that's what the money management report from the payment service provider Klarna found. “While just under three quarters of Baby Boomers (66 percent) and Gen In addition, almost a third (28 percent) of the 18-24 year olds surveyed said that they not only save their money, but also invest it. With an increase of over 75 percent compared to the previous year, Germany now shares first place in investments with Denmark, according to Klarna.

Career starters would also do well to save money at a young age and when starting salaries are still low, reveals the service website Capital.de. No assets would have to be set aside each month. Nevertheless, there is no harm in creating a small security cushion at a young age. Despite the current low interest rates, it's worth having an emergency fund that you can build on over time.

In principle, some experts recommend that every single household save a financial cushion of at least three to at best six available monthly net salaries. For full-time working couples, the ideal situation would be three months' income. While others are of the opinion that there should be a fixed amount, such as 10,000 euros, for the general emergency fund, most are interested in a uniform definition. It would be important not to waste your nest egg on the next big wish or vacation, but to really save it for a potential emergency.

The Money Management Report data shows that the younger generation is increasingly taking responsibility for their financial future. This responsible behavior could lead to greater financial stability for young people in the long term and at the same time have a positive impact on the financial market. More information and education about financial preparedness could help the young generation use their savings and investments even more specifically and effectively to achieve long-term economic goals.