7 Financial New Year’s Resolutions for Gen Z

7 Financial New Year’s Resolutions for Gen Z

Ashley Donohoe   Mon, December 30, 2024  GOBankingRates

The Fidelity Investments 2025 Financial Resolutions Study found that Gen Zers came in second behind millennials for feeling financially optimistic, making plans to reach financial goals and being willing to set resolutions. However, some in this group struggle with paying off student debt, lack sufficient savings and have a hard time managing expenses.

If you’re an adult Gen Zer, starting 2025 with some smart money goals can help improve your financial stability and prepare you for big decisions, including buying a home and starting a family.

Learn the Basics of Money

Since financial literacy is very important for achieving goals, a good 2025 resolution is learning the basics of budgeting, handling debt, saving, investing and managing risk. However, Gen Z is often prone to using social platforms like TikTok to get money advice that might not be accurate. In fact, TikTok is one of the most popular sources for Gen Z to get financial information, as reported by CNBC.

While some of this information can be helpful, Gen Zers may be better off turning to reliable sources, such as financial advisors or mentors, bank financial education portals, expert videos, and personal finance books. Universities and government agencies also often provide financial education courses and other resources.

Live On a Realistic Budget

The Fidelity study also found that Americans in all age groups struggled with inflation and everyday bills. But with many in college or early in their careers, Gen Zers can particularly struggle and rely on extra money from parents to help cover housing and other essentials.

Improving financial stability in 2025 will require making a budget that wisely allocates income and avoids splurging on luxuries that hinder financial goals. It’s then necessary to live on that budget and change financial behaviors when spending appears to get out of control.

You might find keeping this resolution easier with apps like Goodbudget and Rocket Money.

Fill Up an Emergency Fund

According to the 2024 Bank of America Better Money Habits survey, 57% of Gen Z respondents lacked a three-month emergency fund, which is commonly viewed as the minimum recommendation. Not having one not only increases financial stress but also puts Gen Zers at a bigger risk of building up credit card debt.

To prepare for unexpected expenses, consider a New Year’s resolution of setting up a high-interest savings account and contributing regularly until you’ve built up at least three months’ worth of expenses. That money should stay put until it’s needed for true emergencies — such as medical bills or big repairs — rather than unnecessary splurges.

Tackle Student Loans and Credit Cards

TO READ MORE:  https://www.yahoo.com/finance/news/7-financial-resolutions-gen-z-130106706.html