Why older generations cannot relate to Gen Z’s finances.

A generational disconnect.

A few weeks ago, someone sent me a video that highlighted why there is such a difference in how Gen Z views money versus our parents and grandparents. Being an advisor, I see differences in how people view money on a daily basis.

From my experience, I think that age is one of the biggest drivers in how people view anything involving money. This usually stems from how someone grew up and their formative years. It is kind of wild to see someone’s environment impact their views on money throughout their entire life.

The video essentially made this argument:

For older generations, life was cheap, and luxuries were expensive. For Gen Z, life is expensive, but luxuries are cheap.

Now the definition of luxury is subjective. I am not saying that taking a private flight to Europe is now cheap for our generation. But older generations’ ideas of luxuries are now considered cheap. Electronics, appliances, cell phones, etc.

I can’t tell you how many times I’ve heard one of my peers say their grandparents questioned one their purchases.

Usually something along the lines of, “Why are you buying a new computer and a TV when you haven’t even bought a home yet?!”

And to the older generation, they have a really hard time wrapping their head around the fact that those two items, which were considered total luxuries in their day, are actually really cheap relative to purchasing a home or paying rent for our generation.

Check out this chart from AEI.org:

There you have it. Here is another example from stacker.com:

The average cost of eggs in 2024 was about $3. So, egg prices are rising faster than inflation. Inflation adjusted; they should be around $2.65.

I am also pretty sure I saw a 14oz sirloin at Stop & Shop the other day for $14.

After taking a look at these statistics, it becomes pretty clear that life itself has become much more expensive, while previous generations’ ideas of luxuries have only gotten cheaper.

The next time a boomer berates you for not having purchased a home yet, you can show them these stats.

This is also a great example of how personal finance is in fact, personal. Our generation will have obstacles and advantages that will look far different than our parents’ generation.

Taking pointers and small pieces of advice from your elders is great. But trying to follow their exact footsteps to financial freedom is not likely to happen.

Times change and generations adapt. Keep this in mind the next time someone passes off some unsolicited advice on how they did it back in their day!