Gen Zers Taking Steps to Strengthen Financial Health
Younger workers are taking better care of their financial health, shows new findings from the Bank of America’s 2025 Better Money Habits study.
The research, out this week, finds that over the last 12 months, 72% of Gen Zers have taken steps to improve their finances by adding money towards their savings (51%) and paying down debt (24%). Sixty-four percent of respondents are focused on reducing expenses while others are becoming more independent with their finances. The number of those who receive financial support from their parents has decreased to 39% of respondents, down from 46% last year.
Even those who still receive financial support are seeing less money. Twenty-two percent now collect $1,000 or more per month compared to 32% a year ago, and 54% receive less than $500 per month compared to 44% last year.
The rate of younger workers saving more and taking better care of their finances is growing, as many continue to hurdle through growing day-to-day costs. Bank of America’s report shows that 51% list high costs of living as a barrier to financial success, and 35% say they’re spending more than they initially would for everyday expenses like groceries (63%), rent and utilities (47%), and dining out (42%).
“Gen Z is challenging the stereotype when it comes to young people and their finances,” said Holly O’Neill, president of Consumer, Retail and Preferred Banking at Bank of America. “Even though they’re facing economic barriers and high everyday costs, they are working hard to become financially independent and take control of their money.”
Over half (53%) of respondents to Bank of America’s research say they earn a smaller amount than initially thought, and report trouble saving money as a result. Forty-three percent of respondents say they are not on track to save for retirement in the next five years, although they would like to be, and just 25% have contributed to a retirement account in the last year while 21% have invested in the stock market. This is as over a third see saving for retirement and investing as symbols of financial independence (42% and 35%, respectively).
Despite their struggles in the current economic market, other reports display a more resilient attitude in younger investors. Findings from Betterment’s 2025 Retail Investor Survey found that Gen Zers were better inclined to feel confident in the market compared to older generations, given the longer time horizon until retirement and greater availability of retirement products, including digital solutions and artificial intelligence (AI) technology. Betterment reported that 67% of Gen Zers were “significantly more” confident than older generations.
Bank of America’s survey fielded responses from 915 Gen Z adults. More details on the findings can be found here.
SEE ALSO:
Gen Z Total Income Stretches to $1.1T
Gen Z Investors Thrive in Saving for Retirement
From Boomers to Gen Z: How Each Generation Processes Retirement
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.
