For many Gen Zers, the American Dream is slipping further away. The rising cost of living, skyrocketing home prices, and crushing student debt have forced millions of young people to rethink their future.
Owning a home? Out of reach for many.
Starting a family? Too expensive.
Financial independence? A distant goal.
According to Jennifer Rubin, a senior researcher at Foundry10, Gen Z is deeply concerned about achieving the lives they envisioned, with economic instability making traditional milestones feel more impossible than ever.
Gen Z’s Growing Debt Crisis
The numbers are grim.
- Gen Z carries 30% more credit card debt than Millennials did at their age, even after adjusting for inflation.
- They are most likely to max out credit cards and miss payments, according to data from the New York Fed.
- Student loans are crushing financial progress, forcing 79% of borrowers to delay saving for retirement and 52% to abandon homeownership dreams, according to a survey from Laurel Road and Luminary.
Alyssa Schaefer, general manager at Laurel Road, says student loan uncertainty is “having long-term implications on young people’s financial milestones.”
Locked Out of Homeownership
The dream of owning a home is becoming a fantasy for many young Americans.
- Homeownership rates for young adults have dropped from 44% in 2004 to 37% today, according to Census data.
- The number of 25- to 34-year-olds still living at home has climbed from 11% in the early 2000s to 16% in 2023.
- Mortgage rates are at two-decade highs, making affordability even worse.
Enrique Martínez García, an economist at the Dallas Fed, warns that delayed homeownership and family formation will have profound consequences on economic growth and wealth-building for an entire generation.
Young Americans Are Delaying Families
Even starting a family is financially out of reach for many Gen Zers.
- A 2023 Pew Research survey found that among childless adults under 50, 36% said they couldn’t afford to have kids.
- The cost of daycare, healthcare, and basic living expenses has left many young people uncertain about their financial future.
Roberta Katz, co-author of “Gen Z Explained,” says young people “worry whether they will be able to earn enough to have families” in the future.
Social Media & Easy Spending Are Making It Worse
It’s not just student debt and inflation—social media and digital payments are fueling reckless spending.
- Apps like Instagram and TikTok act as virtual shopping malls, pushing impulse spending.
- Buy now, pay later services like Afterpay make it easier than ever to rack up debt without realizing it.
- Financial expert Keisha Blair warns that Gen Z’s spending habits could wreck their credit scores, preventing them from securing a mortgage or car loan.
Can Gen Z Turn It Around?
Despite these setbacks, financial experts say young Americans still have options.
Rod Griffin, Experian’s senior director of consumer education, recommends:
- Creating a realistic budget and sticking to it
- Cutting unnecessary expenses, like subscription services
- Avoiding impulse purchases
- Seeking professional financial advice
Meanwhile, Elizabeth Husserl, author of “The Power of Enough,” encourages Gen Z to redefine wealth on their own terms.
- Buying homes with friends to split costs
- Pursuing side hustles instead of relying on corporate careers
- Choosing alternative education to avoid massive student debt
Gen Z may be struggling in ways previous generations didn’t, but with smart money management and creative solutions, they still have the chance to rewrite their financial future.
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