Are Gen Z Spoiled and Entitled, or Just Realistic About Finances?

There have been a lot of social media posts recently about how delusional Gen Z are when it comes to finances, with one much-shared post stating one particular statistic.

The stat was pulled from a survey conducted by Empower and reported in Fortune, and the soundbite being widely posted (and ridiculed) is this:

Gen Zers on average believe an annual salary of $587,797 and net worth of $9.47 million are needed when they envision “financial success.”

Older generations have different views, with Gen X defining financial success as an annual salary of $212,321 along with a net worth of $5.3 million, while Boomers put those numbers at a seemingly modest $99,874 and $1.05 million.

Unsurprisingly the Boomers are (once again) up in arms at what they see as the greed, delusion and entitlement of youth. But once again it’s probably a simple case of the Zoomers and the Boomers misunderstanding each other.

Gen Z may or may not aspire to these kinds of salaries and this kind of net worth. I’m sure some of them do. However it’s also possible that they are simply being realistic.

There are already very average homes for sale in high cost-of-living cities for somewhere between one and two million — so any Gen Zers who want to go the traditional route that the Boomers did — in terms of home ownership — are looking at a very different scenario. If they want to find a lender ready to loan them three to four times their salary in the form of a mortgage, they would indeed need a salary around the $500,000 mark.

Boomers who raised kids back in the days when kids pretty much raised themselves, financially speaking, and whose salaries were reasonably well-matched to the housing market, are unlikely to really understand what the landscape looks like right now for Gen Z workers.

Unlike the Boomers, they’re graduating college (often with significant amounts of student debt) and looking at average family homes in the million-dollar plus bracket. If they want kids, they’re also looking at childcare costs of up to $1,760 a month in some cities.

What Boomers are often not aware of is that when Gen Z talk about what it might take to be financially successful, they’re often far from entitled. In fact they’re often assuming that this level of financial success is — and will remain — out of reach for them, depending on their life choices.

They may still define ‘financial success’ in terms of owning a nice home and having enough money to raise kids who have (at least) the same advantages they had themselves. However, they way they define success overall is somewhat different.

What’s interesting about the way Gen Z are looking at the world is that —  unlike their Boomer grandparents — they don’t take the American Dream for granted any more. Many of them don’t expect to be able to afford a house, or to have a family. And many of them have a very different focus from their grandparent’s generation when it comes to work, lifestyle, and finances.

A 2024 Deloitte study shows that both Gen Z and Millennials are concerned about finances, with 30% saying they do not feel financially secure, and around 60% saying they live live paycheck to paycheck.

The cost of living is their top concern right now by a long way, but their other concerns are — in many ways — impacting their choices in a way many from older generations may not realize.

Among Gen Z workers:

• 86% say having a sense of purpose is very or somewhat important to their overall job satisfaction and well-being
• 50% have rejected an assignment or project based on their personal beliefs
• 46% have already changed or plan to change job or industry due to climate concerns
• 80% of regular generative AI users expect that AI advancements will free up their time and improve work/life balance (with 71% believing that generative AI will cause elimination of jobs)

While many younger workers are only too aware that a greatly increased cost of living (especially for those raising families) is putting ‘financial success’ firmly out of their reach, they are focused on issues that go beyond the financial when it comes to work.

Work/life balance is now the top consideration when Gen Z workers are choosing an employer, with many younger workers prepared to put their own mental health ahead of other goals in the workplace. In fact a recent health and wellness survey found that 38% of Gen Z are prioritizing mental health goals, compared to 13% of Boomers.

Perhaps before we call younger workers out as delusional for the elevated salary and net worth they see as a sign of ‘financial success’, it’s worth looking at the reality these workers face, and the ways they’re redefining the elements of what constitutes success in a challenging economic climate.

Gen Z care about financial security. They even aspire to ‘financial success’, but the context they put it in is much broader than many from previous generations did. Rather than harboring a sense of entitlement, many are simply resigned to a very different kind of life than their Zoomer grandparents had, without the same family structure, debt-free lives and homes, but possibly with more purpose, balance, and — many would suggest — personal success.

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