Interac report reveals how Canada's youngest adults are focusing on budgeting as they take responsibility for everyday living costs
For Canada’s youngest generation of adults, reaching the age when taking greater responsibility for their finances couldn’t have come at a worse time.
With the cost-of-living crisis pressuring household budgets, many Gen Zs are having to take on financial ‘firsts’ like purchasing groceries, paying rent or saving for a vacation.
A new report from Interac Corp. reveals that these young Canadians are more likely than older cohorts to feel stressed, anxious, and overwhelmed by their financial situation.
A key factor in managing their finances is using debit with Gen Z more likely than other generations (70% vs. 55%) to favour this approach.
Interac’s data shows an increase in the use of its debit cards at grocery stores and supermarkets, with smaller basket sizes and more frequent transactions suggesting people are budgeting carefully. Use of discount stores is also rising.
“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.”
Advice with emotion
The survey also gained insights into how Gen Zs want to get financial advice.
More than a third of these young adults said advice would be more useful if it focused on the emotional aspect of managing money, compared to one fifth of Boomers.
Older family members, siblings, and friends were highly-cited as sources for financial advice among Gen Zs compared to older Canadians who prefer to stick with traditional sources such as financial advisors.
“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.”
