The past few years has been quite the roller coaster on so many levels, not the least financially. Early 2020 it felt like we were all going to lose our jobs…fast forward to 2021 and part of 2022 when the stock market roared (‘stocks only go up!’) and money seemed to be plentiful, now in the end of 2022 and 2023 when the economy seems to be slowing down with and we’re all again nervous about our jobs. For many young professionals, potentially more on the younger side fresh out of college these times can be tough, potentially leading them to rely heavily on the bank of Mom and Dad. According to the Pew Research Center, only 24% of young Americans are financially independent by 22, which is down from 32% in 1980.

With increased student debt and a heavy reliance on credit cards, it is becoming increasingly more challenging for Gen Z to do all the things the Boomers and Gen Xers / Millennials were able to at their age. But does that mean they will never be financially responsible or independent, or will they repeat the actions of millennials before them and eschew societal norms and carve a new way of living based on financial constraints? While only time will tell how Gen Z responds to their financial limitations, they can still do things to ensure good financial health.

Here are a few ideas to help Gen Zers get on the right foot financially as they enter the workforce:

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Get good financial advice

While not the most fun thing to do, talking to a financial advisor or getting solid financial advice from trusted parties can help young people get to grips with building wealth and preparing for retirement. Building a long-term Wealth Management relationship can help you to make better and more beneficial decisions regarding your income and investments to ensure good financial health.

Make sure you choose an advisor who can offer you independent advice and has experience and expertise with your particular situation to find you the best course for future financial health. Be sure to ask if they are a fiduciary, which means they must put your interests above their own (which they won’t always do!) Alternatively if a full blown financial advisor seems like too much for right now; seek out good financial knowledge as talked about in the next paragraph.

Become financially literate

A 2018 study found that nearly a third of young people were financially illiterate. Not knowing about finances, budgeting, savings, or how to handle credit can follow a young person throughout their life and cause massive issues going forward. Could this be because only 17 states require high school students to be financially literate before they graduate? While we will never honestly know if students are being failed due to this not being mandated in more states, nonprofits are pushing for young people to learn financial skills. They are supporting them in improving their knowledge of money, credit, and their ability to manage their income and expenditures. Talk to nonprofits, follow financial influencers, or talk to someone you know who has a good handle on their finances to help you get on the right path. Or since you’re here on this site – start with the 3 Cardinal Rules to get you started!

Create a budget

I always say that if you only are going to do one thing with your money it would be to start and maintain a budget. If you know where your money is going, you will have a better handle on where it is going and what you spend it on. Sit down with someone you trust, go through all of your finances, and make sure you know what is coming in and what is going out. List your essential bills first, such as rent, mortgage, utility taxes, etc., then your frivolous spending and debts. From here, you will have a clearer picture of where you stand and what you are working with to help you become more financially responsible.

Conclusion

It is never too late to look at your financial health and become more financially responsible no matter how old you are. Managing finances and having a handle on your credit is something every adult needs to know and is a skill that will serve you well now and in the future. So while it might not be the most exciting thing you want to spend your time on, it is definitely something you need to focus on sooner rather than later to avoid making massive financial mistakes you cannot recover from.

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