More than three quarters of Brits will be forced to change their spending habits
A quarter (24 per cent) of young adults claim the ongoing ‘cost-of-living crisis’ is the leading cause of anxiety in their life.
Rising energy bills (46 per cent), petrol (44 per cent) and food prices (43 per cent) are hitting their finances the hardest.
More than three quarters (76 per cent) will be forced to change their spending habits to navigate the current financial landscape.
Going out less (54 per cent), shopping less (52 per cent) and reducing food deliveries (51 per cent) are among the top cutbacks Gen Z are having to make.
Worryingly, 12 per cent think they will have to reduce their pension contributions too, rising to 27 per cent among young Scottish adults.
Taking charge of our financial well-being
The findings come from PayPal’s Gen Z Financial Wellness Study, which polled 1,000 young UK adults aged 18 – 25, exploring their greatest financial challenges and how they are taking charge of their financial well-being.
Vincent Belloc, managing director for PayPal UK, said: “The cost-of-living crisis is impacting us all, but for Gen Z, it’s the first time they’ve had to battle soaring inflation”.
The research also found there are some things Gen Z refuse to compromise on – and setting money aside for savings comes out on top (42 per cent).
They are also reluctant to give up on their healthy lifestyle (37 per cent) and socialising (32 per cent).
Although set on saving, Gen Z have some reservations about the future as 33 per cent worried they’ll never own a property or even start a family in the future.
Shockingly, the top financial goal for a quarter of Gen Z adults is to simply not be worried before they look at their bank balance.
Struggling to save money
It also emerged that with an average of just £320 at the end of each month, 51 per cent find it impossible to save money.
But 80 per cent of Gen Z, polled via OnePoll, feel confident they’ll achieve their financial goals, with 55 per cent believing this will happen within the next six years.
Taking matters into their own hands to secure their financial future, they are creating budgets to stick to (44 per cent), looking out for discounts (43 per cent) and tracking their spending (40 per cent).
Vincent Belloc, from Paypal UK, added: “It is critical that we support young adults to reach their financial goals by sharing our experiences and advice, and actively addressing any knowledge gaps.
“We're committed to connecting these young adults to a range of resources and guidance to empower them on their journey to financial wellness, with tips on how to spend smartly and through products like the PayPal App to help manage their spending."
Blaz, a 25 year-old from London, manages a full-time job as a corporate receptionist, but dedicates his spare time during evenings and weekends to building his online spice business to boost his income.
He said: “As a teenager, I discovered my passion for cooking and exploring different spices.
“When I was furloughed in 2020, I was the given space and time to grow that passion into The Spice Avenue, a business that sells ecological conscious, hand-blended spices to those looking to start their cooking journey.
“Now I’m back in full time employment, I use my spare time to keep my business running and growing.
“Currently, I’m saving the extra income I make through The Spice Avenue towards the deposit for a house. It’s so great to see that dream becoming more of a reality.”