Gen Z anxiously navigates financial firsts and shifts everyday spending behaviour amid current economic conditions

Survey finds Gen Z want to improve their relationship with money and looks to a more mindful approach to financial advice 

TORONTO, May 17, 2023 /CNW/ - As Generation Z (Gen Z) enters the workforce and takes on financial 'firsts' like purchasing groceries, paying rent or saving for a vacation, new research commissioned by Interac Corp., suggests that Gen Zs are more likely to feel stressed (42 per cent), anxious (37 per cent) and overwhelmed (31 per cent) than any other generation when it comes to their financial situation. With this, Gen Z admits to leaning on debit to take charge of their finances. As a self-proclaimed debit-first generation, Gen Z is more likely (70 per cent) to frequently use debit, compared to 55 per cent of non Gen Z Canadians polled, as they adjust how they manage everyday spending.

Nearly eight in ten Gen Z respondents agree inflation (78 per cent) and the cost of everyday essentials (75 per cent) are two external factors influencing their ability to manage finances. Canadians overall appear to be shifting their spending in response. Year-over-year, Interac transaction data shows an increase in the number of transactions with Interac Debit at grocery stores and supermarkets as average basket sizes have decreased. This suggests consumers are transacting more frequently, with smaller basket sizes, perhaps to lessen budget strain. Likewise, discount merchants are seeing greater transaction growth than their premium counterparts, suggesting Canadians are shifting where and how they spend to stretch their dollars further.

"While we are seeing the economic environment shape purchasing decisions, essential spending continues and consumers are leaning on their own money as evidenced by the year-over-year growth in Interac Debit (5%) and Interac e-Transfer (11%) volumes," said William Keliehor, Chief Commercial Officer, Interac Corp. "In times of uncertainty, debit remains an empowering tool to help Canadians of all generations, including Gen Z, stay in charge of their finances."

As this cohort of Canadians navigates an uncertain economy, a different style of financial advice is needed to help Gen Z take control. Gen Zs (37 per cent) agree that financial advice would be more beneficial if it focused on the emotional aspect of managing your money, compared to only 21 per cent of Boomers surveyed. While older Canadians stick with traditional sources for financial advice, such as financial advisors, Gen Zs were found most likely to seek out support from their immediate network like older family members (73 per cent), siblings or cousins (20 per cent) and friends (21 per cent).

"As Gen Z navigates many financial firsts, we have a vested interest in understanding their spending behaviours and financial mindset so we can better deliver the experiences and resources they crave," says Daria Hill, Vice President, Marketing & Communications at Interac Corp. "This generation is bringing a different perspective to their finances – one that demands next generation financial literacy resources in line with their values and realities." 

Conscious Economics has created Mindfulness & Money programming in partnership with Interac, rooted in the concept of financial therapy, to help break down some of the barriers Gen Zs face to feel in control of their money and build their financial confidence.

"We know there's an opportunity to revitalize financial advice for younger generations and it starts with the concept of mindfulness," said Aseel El-Baba, Conscious Economics' in-house Financial Therapist. "While traditional financial advice plays a role for any generation, Gen Zs are seeking out emotional support to feel more in control of their financial reality. They need peer-to-peer bonds, guidance from trusted friends and new tools to focus on controlling what they can – we're thrilled to continue partnering with Interac to bring these resources where they're needed."

Conscious Economics and Interac offer the following advice for Gen Z rooted in the concept of financial therapy:

• Find your Emotional Support Human: It may not feel natural to strike up a conversation about money with friends, but it can change the way you relate to money. Find your trusted confidant – that person you find has a calming, supportive presence – and learn from their POV. That might be a friend who's successfully crossing off their financial firsts like making their first investment or renting their first apartment. Start a conversation about their experiences – both positive and negative – and draw inspiration for your next move (literally or figuratively).
• Take charge of your financial well-being by spending what's yours: Stress often comes from worrying about things in the future that you can't influence. Instead, take control by focusing on making choices that have an immediate impact on managing your budget: for example, making Interac Debit the default in your mobile wallet or merchant app so you're only spending what you can immediately afford; or, using Interac e-Transfer to pay instantly or to split costs with others, making shared experiences more affordable and easier to track. Nearly eight in ten Gen Zs polled (78 per cent) say Interac e-Transfer is the simplest way for them to split costs.
• Find your community and explore financial wellness through new tools: Finding that community to connect on finances will help you realize you're not in this alone. Whether it's starting a community social media group or connecting and continuing your financial wellness journey with Conscious Economics and Interac – support is there if you're looking for it. Flex your financial wellbeing skills and develop new ones through the lens of mindfulness using Mindfulness & Money – a free resource available to all Canadians. The modules are informed by real, lived experiences and anchored in financial therapy.

For more tips and support, click HERE.

About the research

Hill+Knowlton Strategies used the Leger Opinion online panel to survey 1,751 Canadians over the period of April 12th to 17th, 2023. Sampling was done within age, gender, and region quotas, and includes a boost of n=250 Canadians aged 18 to 25. The length of survey was 10 minutes. Data was weighted on age, gender, and region according to 2016 census figures. An associated margin of error for a randomly selected sample of n=1,751 would be ±2.5%, 19 times out of 20.

About Conscious Economics

Conscious Economics is a national not-for-profit organization and global social enterprise headquartered in Canada, with a 10-year history and proven track record in economic education, financial literacy programs, research, events and experiential learning. We have staged over 1,000 events that have gathered youth, business leaders, policy makers, change agents, educators, industry associations, charities, and not-for-profits. While we engage with all communities, we maintain a specialized focus on vulnerable populations including BIPOC, LGBTQ2S+, Women and Artists.

About Interac Corp.

Interac empowers Canadians to transact digitally with confidence by providing payment and value exchange services. In helping to develop the future of money and data in Canada, security is the core of everything we do. We help keep Canadian customers safe and secure when transacting. With nearly 300 financial institutions connected to our network, Canadians choose Interac products over 20 million times a day on average to exchange money. Interac champions workplace culture, community, and corporate citizenship. We are proud to be one of Canada's leading and most trusted financial brands. For more information, visit our website.

Interac and Interac e-Transfer are registered trade-marks of Interac Corp.

SOURCE Interac Corp.

Media Contact: Interac Corp., 416-869-2017, [email protected]