YOLO spending, dupes, and wealth hacking: Behind the Gen Z money mentality

The way today’s young adults approach money is entirely unique. There’s never been a generation so reliant on social media, fintech platforms, and “finfluencers” to gather their intel — in fact, Gen Zers are 1.8 times more likely than older generations to cite social media as the impetus for investing.

It’s really no surprise: Born between the mid-1990s and the early 2010s, this generation is the first to grow up in a world dominated by technology. With the ability to shop and earn money online (even with nonphysical items), everything has immediate monetary value — even individuals’ data can be bought and sold. Gen Zers, estimated to spend upwards of $143 billion a year in the U.S., are also projected to be America’s largest generation by 2034, with nearly 80 million members.

Brands are eager to cash in on this generation. At TBWA\Chiat\Day New York’s “Money Is More Than Banking” panel in early October, Gen Z experts came together to discuss the generation’s major money habits.

The major takeaway was that, while this generation leans into saving and using budgeting apps (more than two-thirds use a budgeting tool), they love cashing in their hard-earned money on experiences like travel, concerts, eating out, and anything that will tout their status, but not bust the bank. The very place they look to for financial advice also inspires their purchases.

“People will go out of their way — even if it means eating a PowerBar once a day for three weeks — if it means that they can then kind of keep up with the Joneses and also spend the summer in Kronos. People are really willing to sacrifice on other parts of their life to really flex. They want to be the person on [Insta]gram with those vacation pics,” said Vivian Tu, also known as Your Rich BFF on TikTok and Instagram, where the ex-Wall Streeter gives more than 4.4 million followers financial tips.

‘Keeping up with the Kardashians’

Andrew Abbott, global agency lead at Reddit, explained how this type of experience-led behavior plays out in consumer activity on its platform, especially in channels like r/creditcards, which has 1.3 million members. For instance, a large part of the reason Capital One saw a 52 percent year-over-year increase in recommendation mentions on the platform was because of Taylor Swift’s Eras Tour. Fans of the musician could gain early access to seats and other perks if they signed up for the Capital One SavorOne credit card.

In turn, these recommendations become decisions. According to an internal Reddit survey, 52 percent of Gen Z Reddit users say they’ve made financial decisions based on the information they’ve found on the platform, where they can ask questions under anonymity.

“We’re seeing the frugality complemented with spending it on experiences such as travel and entertainment,” said Abbott.

There are many theories behind what might be prompting Gen Zers’ YOLO spending behavior, but if you ask Tu, after seeing so much economic uncertainty and not matching the same steps as their parents, the generation is simply frustrated and not hopeful about the impact their saving can have on their futures.

“They’re feeling like if I can’t have that ‘happily ever after’ in that way, I might as well buy that Chanel bag this year,” said Tu. “It’s very much this YOLO mentality that you need to live for now because the future really isn’t promised and there’s no guarantee you’ll ever get there, which is pretty disappointing.”

Viral dupes

And yet, when it comes to splurging on products that flaunt status, Gen Zers would rather opt for items that are high quality but can be bought at a decent price, said Tu. Out of all the thousands of posts the “finfluencer” has published, Tu’s most popular are what she calls “dupes,” in which she finds items that are trending but expensive, and shows her viewers another similar product at a lower price point.

Instead of that $570 La Mer face cream, for example, she recommends a Coco Cabana cream for $22. Or if you’re looking for a Vitamix blender but don’t want to spend $400? Tu points out one on Brandless for $124. “The vast majority of people cannot afford [certain items], but they want to have that status, they want to have that experience,” said Tu. “[Gen Zers] are always looking for the high-quality thing for the low-level price.”

Wealth hacking

There’s also the desire for what Jason Musante, VP and head of brand marketing at fine-art investing platform Masterworks, calls “wealth hacking.” Gen Zers, he said, want to find “a better way, a smarter way, and a more equitable way to level the playing field.” They might turn to Masterworks, for example, to invest in artwork as another way to make money, instead or on top of traditional channels like the stock market.

“A lot of young people are tired of getting rich slow,” said Abbott, pointing to communities on Reddit like the FIRE (financial independence/retiring early) channel. “They want to get rich quick because they do feel like they have that limited time and doing it the old way isn’t going to get them there,” he explained.

In general, the onslaught of social media and the internet effectively changed people’s money goals and ambitions of wealth. “[Gen Zers] are all now aspiring for a life that our parents didn’t see because keeping up with the Joneses back then was taking your binoculars out and looking at your neighbor,” explained Tu. “Keeping up with the Joneses now is keeping up with the Kardashians. You can see an immense amount of wealth at your fingertips on your cellphone, and we start to think that that’s normal.”