Why half of Gen Z Aussies don't have a handle on their finances
Half of Gen Z Aussies don't have a handle on their finances in the wake of COVID-19, according to financial advisory firm Findex.
The survey of 16- to 24-year-olds also found that parents remain the most popular source of financial advice for young Australians.
Their long-term finances are more planned than their daily expenses. While 53% identified strategies to save for big-ticket items like cars or holidays, only a third manage their finances by calculating monthly ingoings and outgoings.
"While half of young Australians feel in control of their finances, this means almost one in two feels in the dark," warns Findex CFO Matt Games.
"It's a shame that young people are still reporting that financial education is not featuring on the school syllabus. A heavy reliance on parents and guardians to educate the next generation on financial literacy is misguided and potentially harmful.
The Findex data also shows that young Australians are turning to banks, finance companies or searching online for financial advice to fill in the gaps in their knowledge.
"Banks and finance companies should take their responsibility as a source of financial advice seriously and ensure they're providing easily understandable and objective financial guidance."
Reinforcing the low financial literacy among this group, the survey also found that 23% of young Aussies do not know how much their employer should be contributing to their super, while 47% didn't know how interest on investments is calculated.
Meanwhile, Commonwealth Bank's inaugural Insights report found that 31% of Gen Z consumers are spending more compared to pre-pandemic levels, more than any other generation and being most affected by job losses.
On a more positive note, though, Gen Z reported improved physical health, savings and money available for necessities.
However, the Findex and CommBank findings are trends, not rules.
Findex respondent Nicholas, 21, was able to save $100,000 by age 19.
Absent formal financial education at school, Nicholas took matters into his own hands.
"Lots of people turn to their parents for financial advice, but I learned early on that mine didn't always have the best financial habits," he says.
"They would often buy new things unnecessarily, throw out items that were still in good condition, or not compare products and services before purchasing to make sure they were getting the best deal. Instead, I turned to experts online."