why young people have no money

00:29:45
https://www.youtube.com/watch?v=5vrcZiTc0Yk

Summary

TLDRThe video explores the financial challenges faced by millennials and Gen Z, emphasizing systemic issues like wage stagnation and rising living costs. It reflects on the transition from college to adulthood, where financial stability remains elusive. The speaker discusses the impact of economic downturns, such as the 2008 crash and the pandemic, on job prospects for young people. Additionally, it highlights spending habits, with a focus on prioritizing experiences over material goods, and the challenges posed by modern payment methods. The video encourages viewers to recognize these issues, take proactive steps towards better financial management, and advocate for systemic change.

Takeaways

  • 💸 Financial struggles are common among millennials and Gen Z.
  • 📉 Wage stagnation has been a persistent issue since the 1970s.
  • 🏠 Rising living costs make it difficult for young adults to afford housing.
  • 🎓 Student debt significantly impacts financial freedom.
  • 🌍 Young people prioritize experiences over saving for retirement.
  • 📊 Systemic issues contribute to financial challenges faced by young adults.
  • 🛍️ Modern payment methods can lead to less awareness of spending.
  • 🤝 Discussing financial issues with peers can empower better decisions.
  • 📈 Recognizing financial struggles is the first step towards solutions.
  • 💡 Proactive financial management can improve individual circumstances.

Timeline

  • 00:00:00 - 00:05:00

    In college, financial struggles were common among peers, with many living frugally and sharing expenses. As the speaker approaches 30, they notice similar financial conversations among friends, highlighting a lack of financial progress for their generation. Despite being in a relatively stable financial position, the speaker still adheres to frugal habits, reflecting a broader trend of financial anxiety among millennials and Gen Z, who face systemic challenges that hinder financial stability.

  • 00:05:00 - 00:10:00

    Income is often perceived as a personal choice, but many factors, including education and family wealth, limit job opportunities. Wage stagnation since the 1970s has exacerbated financial struggles, with many young adults feeling trapped in low-paying jobs. The speaker shares personal experiences of wage changes over time, illustrating the difficulty of achieving financial progress despite working hard and seeking better opportunities.

  • 00:10:00 - 00:15:00

    Young adults today face rising costs for necessities like housing and food, with many living at home to save money. Rent prices have surged, making it difficult for millennials and Gen Z to afford independent living. The speaker emphasizes that even the cheapest housing options often come with hidden costs, further complicating financial stability for young people.

  • 00:15:00 - 00:20:00

    The speaker discusses the impact of planned obsolescence on spending, where low-quality products lead to repeated purchases, straining finances. They argue that systemic issues, such as wage stagnation and rising living costs, are often driven by the interests of the wealthy, making it harder for younger generations to achieve financial security. The economic downturns faced by millennials and Gen Z have further complicated their financial situations, leading to long-term consequences.

  • 00:20:00 - 00:29:45

    While acknowledging the systemic issues affecting young people's finances, the speaker encourages personal responsibility in money management. They highlight the importance of budgeting and making informed financial decisions, even in the face of overwhelming challenges. The video concludes with a call to action for young people to educate themselves about financial literacy and advocate for systemic change, emphasizing that small efforts can lead to significant improvements.

Show more

Mind Map

Video Q&A

  • Why are millennials and Gen Z struggling financially?

    They face systemic issues like wage stagnation, rising living costs, and economic downturns, along with personal spending choices.

  • What are some coping strategies for financial struggles?

    Young adults can adopt frugal habits, seek better job opportunities, and educate themselves on financial management.

  • How has the cost of living changed for young adults?

    Housing, food, and transportation costs have risen significantly, outpacing wage growth.

  • What impact does student debt have on young people's finances?

    Student debt limits financial freedom and increases the likelihood of accumulating other types of debt.

  • Are young people prioritizing experiences over savings?

    Yes, many prefer spending on travel and experiences rather than saving for retirement.

  • What role does systemic change play in financial struggles?

    Systemic issues contribute to financial challenges, and addressing them is crucial for improving economic conditions.

  • How can young adults improve their financial situation?

    By budgeting, seeking better job opportunities, and being aware of their spending habits.

  • What is the significance of recognizing financial issues?

    Understanding financial struggles is the first step towards finding solutions and advocating for change.

  • How can technology impact financial management?

    While technology can simplify transactions, it may also lead to less awareness of spending.

  • What is the importance of discussing financial issues with peers?

    Sharing knowledge can empower individuals to make informed financial decisions and advocate for better conditions.

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  • 00:00:00
    I'm sure you guys have noticed this
  • 00:00:01
    happening, but when I was in college,
  • 00:00:04
    everyone around me was talking about how
  • 00:00:06
    broke they were and eating ramen
  • 00:00:08
    noodles, getting five roommates to split
  • 00:00:11
    the rent. I actually distinctly remember
  • 00:00:13
    a time where one of my roommates checked
  • 00:00:16
    her bank account before going out to the
  • 00:00:18
    bars on the weekend and she only had
  • 00:00:20
    $13, so she said, "I'm only going to get
  • 00:00:23
    one drink." And that's just kind of the
  • 00:00:26
    way it is when you're in your early 20s.
  • 00:00:29
    It doesn't feel weird or scary or wrong.
  • 00:00:33
    You're not supposed to have any money
  • 00:00:34
    then. But now I'm getting close to 30
  • 00:00:38
    and everyone around me is talking about
  • 00:00:40
    how broke they are and picking up side
  • 00:00:43
    jobs, getting roommates, and offering to
  • 00:00:46
    share the good bread they found in the
  • 00:00:48
    dumpster behind the grocery store.
  • 00:00:51
    Financially, there's not much evidence
  • 00:00:54
    of us getting older and progressing. At
  • 00:00:57
    least not as much as I thought there'd
  • 00:00:59
    be. I've seen an article or two about
  • 00:01:02
    millennials finally being in a nonh
  • 00:01:05
    horrible position moneywise, but god, it
  • 00:01:09
    took so long to get there. Like being 40
  • 00:01:13
    and thinking, okay, I can finally start
  • 00:01:16
    to breathe now and my life is half over.
  • 00:01:20
    Even though I am part of a very lucky
  • 00:01:22
    small percent who is doing okay when it
  • 00:01:24
    comes to money for my age, in many ways
  • 00:01:28
    I still live by the same overly frugal
  • 00:01:30
    habits I did when I was 20. And I'm just
  • 00:01:34
    generally an anxious person. So I'm very
  • 00:01:37
    cautious and assume that one wrong move
  • 00:01:40
    and I could be broke. And not to say
  • 00:01:43
    that millennials or Gen Z are the first
  • 00:01:45
    generations to experience money troubles
  • 00:01:48
    because no generation has escaped that.
  • 00:01:51
    But you look back at old photos and hear
  • 00:01:54
    stories of your grandparents who were
  • 00:01:57
    able to afford a house and having two
  • 00:01:59
    kids at 24. Nowadays, if a young person
  • 00:02:03
    buys a house, it can be a news story.
  • 00:02:06
    The idea that millennials are worse off
  • 00:02:08
    than their parents is pretty widely
  • 00:02:11
    known at this point, and it's looking
  • 00:02:13
    like Gen Z are in a similar boat. Today,
  • 00:02:16
    I want to discuss why young adults are
  • 00:02:19
    struggling with money. Both systemic
  • 00:02:21
    reasons that are outside of our control
  • 00:02:24
    and some personal choices that we could
  • 00:02:27
    improve on as individuals.
  • 00:02:29
    [Music]
  • 00:02:33
    Something like income is complicated
  • 00:02:36
    because I think sometimes people come to
  • 00:02:39
    the conclusion that how much you make is
  • 00:02:42
    up to you. You're in control of your
  • 00:02:45
    choices of what types of jobs to go for
  • 00:02:49
    and how many jobs to have and hours to
  • 00:02:51
    work and how much effort you put into
  • 00:02:55
    climbing the ladder to get a higher
  • 00:02:57
    paying job. You get out of it what you
  • 00:02:59
    put into it. But I think income is often
  • 00:03:02
    very much out of your hands. You can try
  • 00:03:05
    to go for high-paying jobs and multiple
  • 00:03:08
    jobs, but someone else is making that
  • 00:03:11
    hiring decision. You have some power to
  • 00:03:14
    put yourself in the best position you
  • 00:03:17
    can, but at the end of the day, there
  • 00:03:19
    are limits in place. Even if you're an
  • 00:03:22
    entrepreneur, you can't pay yourself a
  • 00:03:24
    billion dollars a day. Most of us have a
  • 00:03:27
    lot of limits that we have to live and
  • 00:03:29
    work within. First of all, the types of
  • 00:03:32
    jobs you can feasibly go for are broadly
  • 00:03:36
    dependent on your education, which is
  • 00:03:39
    based on where you live and your
  • 00:03:41
    family's wealth or lack thereof. If you
  • 00:03:45
    grew up in a poor area with a poor
  • 00:03:47
    family, your education options are
  • 00:03:50
    probably not very good. And that's just
  • 00:03:53
    the shitty hand you were dealt. The
  • 00:03:55
    amount of money that your parents could
  • 00:03:57
    contribute to a potential college
  • 00:03:59
    education is not up to you. So, if
  • 00:04:03
    you're starting off with an unimpressive
  • 00:04:05
    education or if you're just a young
  • 00:04:08
    person, you're stuck with lower wage
  • 00:04:11
    jobs. But even for millennials who have
  • 00:04:14
    been in the workforce for some time now
  • 00:04:17
    and maybe have had an opportunity to get
  • 00:04:20
    a bachelor's degree or higher, there's a
  • 00:04:23
    larger problem that has been affecting
  • 00:04:26
    not just poor households, but more
  • 00:04:28
    middle class ones as well, and that's
  • 00:04:31
    wage
  • 00:04:33
    stagnation. This has really been a
  • 00:04:34
    problem since the 1970s. But in the 70s
  • 00:04:38
    and 80s and 90s, people were trying out
  • 00:04:41
    different tactics to balance out wage
  • 00:04:44
    stagnation while still keeping a decent
  • 00:04:46
    living. And some of the primary coping
  • 00:04:48
    strategies are laid out very nicely in a
  • 00:04:52
    documentary called Inequality for All,
  • 00:04:54
    which I highly recommend. But by the
  • 00:04:57
    2000s, when millennials were starting
  • 00:05:00
    college and entering the workforce,
  • 00:05:03
    those strategies had basically been
  • 00:05:06
    exhausted. Just for fun, I actually
  • 00:05:09
    decided to check some of my old jobs to
  • 00:05:12
    see how the pay has changed over time.
  • 00:05:15
    And my first job with a regular paycheck
  • 00:05:18
    was a sandwich artist roughly 15 years
  • 00:05:23
    ago. And I got paid minimum wage
  • 00:05:27
    725, which as a reminder has not
  • 00:05:31
    increased since
  • 00:05:33
    2009, which is the longest time period
  • 00:05:37
    without a federal increase since it was
  • 00:05:39
    literally invented in 1938. The same
  • 00:05:42
    subway job today pays $13 an hour. And I
  • 00:05:47
    use this calculator from the Bureau of
  • 00:05:49
    Labor Statistics and adjusting for
  • 00:05:52
    inflation and the buying power of the
  • 00:05:54
    dollar today. That job essentially pays
  • 00:05:57
    $2 more than it used to 15 years ago. I
  • 00:06:03
    think this really encapsulates the
  • 00:06:04
    feeling of people in their 20s and 30s
  • 00:06:07
    feeling like they're just treading
  • 00:06:09
    water. Because even if you have gotten
  • 00:06:12
    the opportunity to get a higherp paying
  • 00:06:14
    job or get some raises since leaving
  • 00:06:17
    school because of flattening wages, it's
  • 00:06:21
    not enough money to really feel an
  • 00:06:24
    impact. A vast majority of people,
  • 00:06:27
    especially younger generations who
  • 00:06:29
    haven't moved up the ladder much, just
  • 00:06:31
    get paid the wage that is decided by
  • 00:06:34
    higherups in management. And what are
  • 00:06:36
    you going to do? Quit unless they pay
  • 00:06:38
    you more? you are disposable and someone
  • 00:06:41
    else more desperate than you will
  • 00:06:43
    definitely accept that
  • 00:06:44
    [Music]
  • 00:06:47
    job. Aside from not enough money coming
  • 00:06:50
    in, today Gen Z is also facing a
  • 00:06:53
    systemic problem when it comes to money
  • 00:06:56
    going out. And I am going to talk about
  • 00:06:58
    personal spending choices later in this
  • 00:07:01
    video regarding wants rather than needs.
  • 00:07:04
    But for this particular point, I'm
  • 00:07:07
    talking about spending on necessities
  • 00:07:09
    only. Housing, food,
  • 00:07:13
    transportation, health, those kinds of
  • 00:07:15
    things. And to start with, housing, a
  • 00:07:18
    basic need that everyone requires to
  • 00:07:21
    live. The number of young adults who are
  • 00:07:24
    past the typical college age but are
  • 00:07:28
    living at home with parents is 87%
  • 00:07:31
    higher than 20 years ago. And the top
  • 00:07:35
    two reasons that millennials and Gen Z
  • 00:07:37
    gave for why they're doing this is to
  • 00:07:41
    save money and because they can't afford
  • 00:07:43
    their own place to live. Particularly
  • 00:07:46
    towards the end of the pandemic, there
  • 00:07:48
    was a big spike in rent prices in
  • 00:07:51
    America. And maybe that wouldn't have
  • 00:07:53
    been as big of a deal if so many people
  • 00:07:56
    hadn't still been unemployed at the
  • 00:07:58
    time. And you can forget about looking
  • 00:08:00
    at the price of a house. And yes, you
  • 00:08:03
    can choose to just apply for the $1,000
  • 00:08:06
    a month apartment rather than the $2,000
  • 00:08:09
    one. But again, there are these limits.
  • 00:08:13
    Even the cheapest apartment that you can
  • 00:08:15
    possibly find has a monthly rent cost
  • 00:08:19
    that you don't decide. The landlord
  • 00:08:22
    does. And I'm even getting annoyed at
  • 00:08:24
    like suggesting, well, maybe find the
  • 00:08:26
    absolute cheapest apartment in your
  • 00:08:28
    entire city because maybe the rent is
  • 00:08:32
    the cheapest price, but that apartment
  • 00:08:34
    probably has black mold that's going to
  • 00:08:37
    cause you long-term health effects,
  • 00:08:39
    which will take money away from you
  • 00:08:42
    later, or it doesn't have a kitchen, so
  • 00:08:45
    you're going to be spending more money
  • 00:08:46
    on eating out rather than cooking at
  • 00:08:49
    home. Also, speaking of food costs, I
  • 00:08:53
    expect grocery prices to go up over
  • 00:08:56
    time. Inflation is normal. As long as
  • 00:09:00
    companies are expected to deliver
  • 00:09:02
    profits year-over-year and world
  • 00:09:05
    resources get depleted, prices are going
  • 00:09:08
    to go up. That's not really the problem
  • 00:09:10
    I have. Inflation isn't as big of a deal
  • 00:09:14
    if income levels are rising to keep up
  • 00:09:17
    with it. But as I talked about before,
  • 00:09:20
    that's not happening. Since 1970, wages
  • 00:09:24
    have increased 80%. And the national
  • 00:09:28
    consumer price index has risen
  • 00:09:32
    500%. So that has put Gen Z way behind
  • 00:09:36
    past generations when it comes to
  • 00:09:38
    purchasing power. And another problem
  • 00:09:41
    that young people are facing when it
  • 00:09:43
    comes to spending is planned
  • 00:09:46
    obsolescence.
  • 00:09:47
    the regular day-to-day household
  • 00:09:49
    necessities that you're buying.
  • 00:09:51
    Something like a frying pan for cooking,
  • 00:09:54
    that price hasn't gone up that much over
  • 00:09:57
    time. I actually was looking at pots and
  • 00:09:59
    pans recently and I thought they were
  • 00:10:01
    priced pretty reasonably. But something
  • 00:10:03
    you might not initially account for in
  • 00:10:06
    your budget is having to consistently
  • 00:10:09
    replace these items when the coating of
  • 00:10:12
    the pan comes off. Things aren't built
  • 00:10:15
    to last anymore. This leads into the
  • 00:10:18
    boots theory, which I could talk about
  • 00:10:20
    for a lot longer, but it keeps people in
  • 00:10:22
    poverty by making the highquality items
  • 00:10:26
    out of their financial reach, forcing
  • 00:10:28
    them to have to pay more in the long run
  • 00:10:31
    by buying multiple items. And it's not
  • 00:10:34
    even just about keeping nice clothes,
  • 00:10:38
    for example, out of financial reach. I
  • 00:10:41
    feel like the amount of companies even
  • 00:10:44
    producing nice clothes is maybe
  • 00:10:47
    consistent or took a drop off and the
  • 00:10:50
    amount making garbage has skyrocketed.
  • 00:10:53
    It's just another spending problem that
  • 00:10:57
    businesses are making particularly
  • 00:10:59
    difficult for young people just trying
  • 00:11:02
    to buy the things we need.
  • 00:11:08
    I think the flattening wages and
  • 00:11:10
    increased cost of living issues are
  • 00:11:13
    partly due to intentional choices of
  • 00:11:16
    people with a lot of money in power. And
  • 00:11:19
    it's not that I think they want to keep
  • 00:11:21
    money out of the hands of millennials or
  • 00:11:23
    Gen Z in particular. It's just that they
  • 00:11:26
    want to keep it in their own hands. And
  • 00:11:28
    naturally, that means it will be
  • 00:11:30
    withheld from other generations.
  • 00:11:34
    But there's also some larger reasons why
  • 00:11:37
    young people are struggling that I think
  • 00:11:39
    are not so intentional. Something that
  • 00:11:42
    really over millennials was that
  • 00:11:45
    just as they were getting started in
  • 00:11:47
    their adult life, graduating, managing
  • 00:11:49
    finances on their own for the first
  • 00:11:52
    time, the economy crashed in
  • 00:11:55
    2008. The CEOs and bankers and hedge
  • 00:11:58
    fund managers didn't want the market to
  • 00:12:01
    crash. Even though they came out fine,
  • 00:12:03
    it wasn't like that was their intention.
  • 00:12:06
    It was just a side effect and not a
  • 00:12:09
    targeted attack against millennials. But
  • 00:12:12
    the unintended consequences were that it
  • 00:12:14
    took millennials a much harder, longer
  • 00:12:18
    time to get good paying jobs. And now
  • 00:12:21
    Gen Z are in a similar situation. A lot
  • 00:12:25
    of them were just graduating right
  • 00:12:28
    around the time of the pandemic. that
  • 00:12:30
    affected almost everyone's finances in a
  • 00:12:33
    bad way, but it hurts the most for young
  • 00:12:37
    people who haven't had the time to build
  • 00:12:42
    up a personal safety net. Young people,
  • 00:12:45
    I think, are expected to make mistakes
  • 00:12:48
    with money and not be 100% financially
  • 00:12:52
    literate right out of the gate. So, I
  • 00:12:54
    get particularly annoyed when we are set
  • 00:12:57
    up in a way that one bad choice can
  • 00:13:01
    haunt you for 20, 30 years to come. And
  • 00:13:05
    really, when it comes to education,
  • 00:13:08
    starting with millennials and now with
  • 00:13:10
    Gen Z, we are stuck in a scenario where
  • 00:13:15
    a good paying job basically requires a
  • 00:13:18
    bachelor's. And it looks like not only
  • 00:13:21
    is that going to continue to be the case
  • 00:13:23
    as more Gen Z enter the workforce, but
  • 00:13:25
    having a degree is going to be even more
  • 00:13:29
    required to have financial success in
  • 00:13:32
    the future than it is already. Over half
  • 00:13:35
    college grads sign up for student debt.
  • 00:13:38
    And while the amount of debt has been
  • 00:13:41
    stabilizing over the past 10 years,
  • 00:13:43
    which is good, it also looks like these
  • 00:13:46
    circumstances are the new normal when it
  • 00:13:49
    comes to education, debt, and income. If
  • 00:13:52
    you don't get a degree, you have a much
  • 00:13:54
    worse chance of finding a good paying
  • 00:13:57
    job. And if you do get a degree, you
  • 00:14:00
    have a much worse chance of living with
  • 00:14:03
    minimal to no debt. In fact, people who
  • 00:14:06
    have student debt are more likely to
  • 00:14:09
    have debt in general of all kinds. Maybe
  • 00:14:12
    because it's getting 18year-olds started
  • 00:14:16
    on the idea of get comfortable with
  • 00:14:19
    having debt and to have to try and
  • 00:14:22
    understand the complicated future of
  • 00:14:24
    this when you're deciding what you want
  • 00:14:26
    to do with your life in high school.
  • 00:14:28
    You're damned if you do and damned if
  • 00:14:30
    you don't.
  • 00:14:35
    I know I'm kind of exaggerating
  • 00:14:36
    circumstances to make it seem like young
  • 00:14:39
    people are so broke that they're not
  • 00:14:41
    spending money on anything fun. And that
  • 00:14:44
    isn't the case. Even people who are
  • 00:14:46
    below the poverty line still buy things
  • 00:14:50
    that they don't need. So, I want to talk
  • 00:14:53
    about what we're spending discretionary
  • 00:14:56
    income on, what the fun section of our
  • 00:14:59
    budgets look like, and how that affects
  • 00:15:02
    Gen Z's financial situation. I looked
  • 00:15:04
    through some different articles about
  • 00:15:06
    shopping behavior, and I didn't really
  • 00:15:09
    find anything where I was like shocked,
  • 00:15:12
    like, oh my god, Jenzie is spending so
  • 00:15:15
    much on this. Like, yeah, they spend
  • 00:15:18
    more on fashion and beauty, personal
  • 00:15:22
    care products, but like, yeah, of
  • 00:15:25
    course, they're in the physical prime of
  • 00:15:29
    their life. If there's ever a time where
  • 00:15:31
    you value trendiness, it's probably at
  • 00:15:35
    22. That's not to say that I think
  • 00:15:38
    spending hundreds on clothes every month
  • 00:15:40
    is justified or smart money management,
  • 00:15:43
    because it's obviously not. But what I
  • 00:15:46
    thought was more interesting was the
  • 00:15:48
    amount that Gen Z spends on travel and
  • 00:15:52
    activities. And this is something I've
  • 00:15:54
    actually seen discussed a fair amount on
  • 00:15:56
    the internet about Gen Z valuing
  • 00:15:59
    experiences over things. And you can
  • 00:16:03
    make a case for millennials as well,
  • 00:16:05
    especially with the perfect recent
  • 00:16:07
    example of the ERAs tour. Women in their
  • 00:16:11
    30s apparently will shell out thousands
  • 00:16:14
    to see one of those shows. Young people
  • 00:16:18
    are traveling and going on trips. Even
  • 00:16:20
    if they have debt, even if they're
  • 00:16:22
    worried about finances, they will make
  • 00:16:24
    room for this. And this is something I
  • 00:16:26
    really identify with. Ask anyone I've
  • 00:16:29
    ever worked with. If I'm taking PTO, I
  • 00:16:32
    am going somewhere exciting. I am
  • 00:16:35
    traveling somewhere cool. I am putting
  • 00:16:37
    my money to work. And when it comes to
  • 00:16:40
    priorities, 60% of Gen Z's said that
  • 00:16:43
    they would rather spend money on
  • 00:16:46
    experiences now than save for
  • 00:16:49
    retirement. So on one hand, I'm a big
  • 00:16:52
    proponent of spending your money to
  • 00:16:55
    travel earlier in life because you
  • 00:16:59
    probably have less commitments, less
  • 00:17:02
    responsibilities financially and
  • 00:17:04
    otherwise. you are probably healthier
  • 00:17:07
    and more able to go on an adventure. It
  • 00:17:10
    can help shape you becoming an adult and
  • 00:17:14
    change perspectives you have on other
  • 00:17:16
    people in the world and culture. I've
  • 00:17:21
    been backpacking a number of times and
  • 00:17:24
    it 100% no doubt changed my life for the
  • 00:17:27
    better. On the other hand, I can't say
  • 00:17:30
    that it'll be good for you financially
  • 00:17:32
    at all. like you can pick cheaper
  • 00:17:35
    experiences, but in general as a
  • 00:17:39
    category, experiences are usually on the
  • 00:17:42
    more expensive side of things. And
  • 00:17:45
    another problem is that if you use your
  • 00:17:47
    money to buy stuff, it will hold a
  • 00:17:51
    monetary value. It can be resold later.
  • 00:17:55
    A concert or a vacation will never have
  • 00:17:58
    that. So, I could say don't spend on
  • 00:18:01
    these experiences. It'll be bad for your
  • 00:18:03
    bank account. And having financial
  • 00:18:06
    security can bring a sense of happiness
  • 00:18:08
    and reduce anxiety from your life. But
  • 00:18:13
    also going on a life-changing trip can
  • 00:18:16
    also bring you happiness and lifelong
  • 00:18:20
    memories. You can always have a chance
  • 00:18:23
    to make money back, but you can never
  • 00:18:25
    get time poorly spent back.
  • 00:18:33
    Speaking of transactions of non-tangible
  • 00:18:35
    things, it's not just travel. We are
  • 00:18:39
    making more purchases of things that
  • 00:18:41
    used to be physical assets but aren't
  • 00:18:44
    anymore. And we're not able to own these
  • 00:18:48
    things because it's more of paying to
  • 00:18:52
    rent a digital service for a limited
  • 00:18:56
    period of time. You don't own movies or
  • 00:18:59
    music, maybe even clothes or books or
  • 00:19:03
    someday even your car. And not that you
  • 00:19:06
    can't own these things anymore. It's
  • 00:19:09
    just not as popular as the subscription
  • 00:19:11
    rental services. Companies are moving
  • 00:19:13
    away from it. And so so is the next
  • 00:19:16
    generation of consumers. Gen Z is more
  • 00:19:19
    comfortable with technology and ordering
  • 00:19:21
    online and subscription licensing models
  • 00:19:25
    than anyone has ever been. They're
  • 00:19:27
    digital natives. And it also seems like
  • 00:19:30
    we're more comfortable than ever with
  • 00:19:33
    invisible money. In my opinion, that
  • 00:19:36
    will not mean good things for the
  • 00:19:38
    long-term finances of Gen Z. If you
  • 00:19:41
    think about the purchase of a movie 50
  • 00:19:45
    years ago, you had one option. You go to
  • 00:19:48
    a location, you take money out of your
  • 00:19:51
    pocket, and then you see the movie right
  • 00:19:54
    away. The cost of the movie is very
  • 00:19:57
    obvious. You watch the dollars leave
  • 00:20:00
    your pocket in exchange for the
  • 00:20:02
    experience. Nowadays, so many businesses
  • 00:20:05
    don't even accept cash. And when you go
  • 00:20:08
    to watch a movie on Netflix, it doesn't
  • 00:20:11
    feel like there was any transaction at
  • 00:20:14
    all. Your wallet feels the same. Your
  • 00:20:16
    bank doesn't give you a notification
  • 00:20:18
    when the monthly subscription is charged
  • 00:20:20
    to your account. It all happens in the
  • 00:20:24
    cloud or behind a digital curtain. And
  • 00:20:27
    many companies have gone from one-time
  • 00:20:30
    purchases towards the subscription
  • 00:20:33
    model. Not because it is financially any
  • 00:20:35
    better for the consumer, but in the wise
  • 00:20:38
    words of Drew Gooden, I sell you a
  • 00:20:41
    product that you only have to buy once
  • 00:20:42
    and then get to keep it forever. How
  • 00:20:44
    will I get more money from you in the
  • 00:20:46
    future? How will line keep go up if
  • 00:20:49
    transaction over? My whole concern is
  • 00:20:52
    really that the more separation between
  • 00:20:55
    us and how much we think we have and how
  • 00:20:59
    much we think things cost, the blurrier
  • 00:21:03
    that line gets, the harder it is to be
  • 00:21:06
    smart with your finances. There's been
  • 00:21:08
    another big disconnect in the payment
  • 00:21:10
    process with the adoption of the buy now
  • 00:21:12
    pay later model, which I think makes the
  • 00:21:15
    transaction feel even more invisible and
  • 00:21:18
    not real. And I have similar feelings
  • 00:21:20
    about Apple Pay. Like you just tap your
  • 00:21:22
    wrist and you've bought something now.
  • 00:21:26
    Like it feels so Black Mirror to me.
  • 00:21:29
    Before long, we're just going to be like
  • 00:21:31
    looking at our phone at an ad and it's
  • 00:21:33
    going to say like blink twice to buy and
  • 00:21:35
    you
  • 00:21:38
    do. It's too easy to make purchases now
  • 00:21:42
    all the time. No matter where you are
  • 00:21:44
    and how much money you have, whether you
  • 00:21:46
    can afford it or not. And I'm
  • 00:21:49
    disappointed in the companies like
  • 00:21:51
    Afterpay and CLA for essentially
  • 00:21:55
    encouraging consumers to buy regardless
  • 00:21:58
    of their financial situation. But I'm
  • 00:22:00
    also disappointed in the consumers for
  • 00:22:03
    falling into the trap. Just during the
  • 00:22:06
    pandemic, spending with buy now pay
  • 00:22:08
    later increased
  • 00:22:11
    214% by Gen Z in just one year. And it's
  • 00:22:15
    not like you're investing money into
  • 00:22:19
    something like a house or education that
  • 00:22:22
    you'll pay off later. Buy now pay later
  • 00:22:25
    is mostly used by Jenzian and
  • 00:22:27
    millennials to buy clothes, particularly
  • 00:22:31
    shoes. And I know I'm probably going to
  • 00:22:34
    come across either like a grandma or
  • 00:22:38
    like some holier than thou pick me, but
  • 00:22:41
    I just can't understand what is so
  • 00:22:44
    deeply important about the shoes. And
  • 00:22:46
    this is coming from someone who actually
  • 00:22:48
    like is interested in fashion. Like I
  • 00:22:52
    like to keep up with the trends and I
  • 00:22:55
    know about the brands and the quality
  • 00:22:57
    and the fabric and design. I just
  • 00:23:01
    realized that this isn't where I really
  • 00:23:05
    want my money to be going. So, I'm more
  • 00:23:08
    of a watcher now than a
  • 00:23:11
    participant. And maybe the same turn is
  • 00:23:15
    coming for Jenz as well. We will see in
  • 00:23:18
    the next few years.
  • 00:23:24
    I know I've placed plenty of blame on
  • 00:23:26
    outside forces and systemic problems as
  • 00:23:30
    to why so many young people are
  • 00:23:32
    struggling financially. That's my
  • 00:23:34
    assessment. I think it's justified. But
  • 00:23:37
    I don't use it as an excuse to not make
  • 00:23:41
    better money decisions personally, and I
  • 00:23:44
    don't think you should either. This is
  • 00:23:46
    something I see sometimes with younger
  • 00:23:48
    generations seeing the problems stacked
  • 00:23:51
    up against them from the start and
  • 00:23:54
    giving up. We've all seen posts like
  • 00:23:57
    these. I can't wait to die. Honestly, I
  • 00:24:01
    cannot wait to die. And I get it. It's
  • 00:24:05
    discouraging. It seems feudal to try.
  • 00:24:08
    What? You're going to change the system
  • 00:24:10
    by making a budget? The problems of
  • 00:24:13
    flattening wages and student debt and
  • 00:24:16
    recessions happening when you're
  • 00:24:18
    embarking out into adulthood are too big
  • 00:24:22
    to solve on your own by making
  • 00:24:24
    responsible choices. And some of the
  • 00:24:26
    stress and doomer attitude has reflected
  • 00:24:30
    itself in enrollment rates for higher
  • 00:24:33
    education. Young generations are not so
  • 00:24:36
    sure the benefits of a degree outweigh
  • 00:24:39
    the insane price tag. The enrollment
  • 00:24:43
    rates for high school grads going into
  • 00:24:45
    college used to be 70% in 2009, but in
  • 00:24:50
    2022 dropped down to
  • 00:24:53
    62%. It's so scary to see that. I hate
  • 00:24:56
    seeing people make the choice to forego
  • 00:24:58
    education because it's too expensive.
  • 00:25:01
    and I can empathize with their position,
  • 00:25:04
    but I know what a less educated populace
  • 00:25:07
    will mean in the long term, and it's not
  • 00:25:09
    financial prosperity. I'm making this
  • 00:25:12
    video in the spring of 2025, and
  • 00:25:16
    economically, it's looking like dark
  • 00:25:19
    times ahead again. And it's kind of
  • 00:25:22
    funny because some of the articles I
  • 00:25:24
    read when I was researching for this
  • 00:25:25
    video end with the financial expert
  • 00:25:29
    saying something like, "Well, despite
  • 00:25:31
    all the really terrifying data I've just
  • 00:25:33
    showed you of how we're all screwed, Gen
  • 00:25:36
    Z is actually really uh creative when it
  • 00:25:39
    comes to money and different side
  • 00:25:41
    hustles and thrifting in order to save.
  • 00:25:44
    as if somehow these tips and tricks will
  • 00:25:47
    be enough to save us from the massive
  • 00:25:50
    fiscal crisis we're facing.
  • 00:25:53
    However, just because it's not enough to
  • 00:25:57
    fix all the problems doesn't mean that
  • 00:25:59
    you shouldn't make an effort to be
  • 00:26:02
    frugal and responsible with money. Being
  • 00:26:05
    in debt sucks, but I'll take 10k of debt
  • 00:26:08
    over 30k of debt every day of the week.
  • 00:26:11
    $15 an hour is not enough for an hourly
  • 00:26:15
    wage, but between that and 725, I'll
  • 00:26:18
    take the 15. I know the groceries are
  • 00:26:21
    too expensive, but doesn't mean you
  • 00:26:24
    should just buy the organic bananas
  • 00:26:26
    because, well, it. I'm going broke
  • 00:26:29
    anyway. Not to say that you can never
  • 00:26:32
    treat yourself and have to pinch every
  • 00:26:33
    penny forever. But there are other ways
  • 00:26:36
    to cope. It's just about trying. And
  • 00:26:39
    worst case scenario, maybe you don't
  • 00:26:41
    save that much, but you learned some
  • 00:26:43
    things about smart money management and
  • 00:26:46
    making better
  • 00:26:47
    choices. You can also do better while
  • 00:26:50
    still saying the government and larger
  • 00:26:54
    systems and institutions, they need to
  • 00:26:56
    do better, too. I'm going to try. They
  • 00:26:59
    need to try. One of the best decisions I
  • 00:27:01
    ever made was taking the money in my
  • 00:27:03
    savings account and putting it into a
  • 00:27:06
    high yield savings account. It took 20
  • 00:27:08
    minutes to finally figure it out. Will
  • 00:27:10
    it solve all your financial problems?
  • 00:27:13
    No. But it's something. And a little of
  • 00:27:16
    something is better than giving
  • 00:27:18
    [Music]
  • 00:27:21
    up. I want to wrap up this video by
  • 00:27:24
    talking about what's possible for the
  • 00:27:26
    future of millennials and Gen Z
  • 00:27:29
    financially and future generations of
  • 00:27:32
    young people. What can we do for
  • 00:27:34
    ourselves now? And how can we turn
  • 00:27:36
    things around? I've said this in the
  • 00:27:38
    past about a lot of different topics,
  • 00:27:40
    but I'll say it again. The first step to
  • 00:27:44
    fixing any problem is recognizing it and
  • 00:27:47
    understanding it better. Why is this
  • 00:27:50
    happening? And let's talk about it
  • 00:27:54
    and share knowledge. Read some books or
  • 00:27:57
    articles, watch some
  • 00:27:59
    documentaries, discuss with people in
  • 00:28:02
    your life. And regarding what I said
  • 00:28:04
    earlier about like low salaries, I know
  • 00:28:07
    not everyone is in a position to do
  • 00:28:09
    this, but in a previous job, I kind of
  • 00:28:13
    sused out the situation with my
  • 00:28:15
    co-workers and was able to actually get
  • 00:28:18
    up the courage to say numbers. And I
  • 00:28:22
    found out that I was being paid the
  • 00:28:25
    lowest out of everyone else on my team,
  • 00:28:28
    regardless if I had equal or more
  • 00:28:31
    experience than them. and that put me in
  • 00:28:33
    a much better position to ask for a
  • 00:28:35
    raise. Maybe you're in a situation where
  • 00:28:38
    unionizing is an option to get better
  • 00:28:41
    benefits. Or if not, you can just
  • 00:28:43
    support others who do. Get your
  • 00:28:46
    together. Know everything that's going
  • 00:28:48
    out, everything that's coming in. Be
  • 00:28:51
    organized. There's a lot of apps that
  • 00:28:53
    make this super easy. Or you can just
  • 00:28:55
    have your own personal document. If
  • 00:28:58
    these ideas and awareness spread to
  • 00:29:01
    enough people, the hope is that
  • 00:29:03
    eventually it will be enough so that
  • 00:29:07
    largecale systemic change is within
  • 00:29:10
    easier reach. We can at least try to
  • 00:29:13
    change the flawed financial systems
  • 00:29:15
    around us as best we can. Maybe it'll
  • 00:29:18
    hardly help at all. Maybe it'll help a
  • 00:29:21
    lot. But you miss 100% of the shots you
  • 00:29:24
    don't take, you know? So, if you enjoyed
  • 00:29:28
    this video, please consider giving it a
  • 00:29:30
    like or a comment or subscribing. And
  • 00:29:34
    thanks for watching.
  • 00:29:38
    [Music]
Tags
  • millennials
  • Gen Z
  • financial struggles
  • wage stagnation
  • cost of living
  • student debt
  • spending habits
  • economic downturn
  • financial management
  • systemic change