How the Pandemic Has Changed the Way Millennials and Gen Zs Think About Money
Sep 5, 2021 • Cristina Morales
The Philippines is in the middle of the longest lockdown in the world. Some of us have learned how to cope, many of us are still struggling, but all of us have been affected in one way or another. According to a recent report, the challenges brought about by the pandemic have affected the way Filipino millennials and Gen Zs deal with money and their personal wellness.
In a report titled “Know Your Ys and Zs: A closer look at the financial and mental well-being of Filipino Millennials and Generation Z in the time of COVID-19”, Manulife surveyed 500 respondents across the Philippines between April and May 2021 to better understand the attitudes and habits of younger generations towards finance and personal wellbeing. Here are just some of their findings.
What happened to YOLO?
Pre-pandemic, YOLO was the battle cry of young people who threw caution to the wind. Now, we’re all hyper-aware of the fact that you only live once — so that means we better get our sh*t together before we mess things up.
According to Melissa Henson, Chief Marketing Officer of Manulife Philippines, millennials (aged 25-40) and Gen Zs (aged 15-24) have drastically changed their attitudes towards money. This volatile time, she says, has “accelerat[ed] their desire for financial stability.”
We’re now more anxious
According to Manulife’s new study, the top concerns that Millennials and Generation Z are grappling with during the pandemic are:
- running out of money
- getting sick
- losing their lives or their loved ones
- declining mental health
- and drowning in debt
Because of these stressors, we’re prioritizing our health and saving more. 87% of Millennials and Gen Z are worried about the future, so most are saving so they can create a safety net.
Money worries are taking a toll on our mental health
Worries about debt and the looming possibility of job loss are also getting to working Gen Z and Millennials’ mental health. How are they coping?
Gen Zs, in particular, are practicing various ways to improve their mental health, with the most common activities being:
- getting enough sleep (84%)
- enjoying a proper meal (76%)
- talking to friends and family (74%)
- making time for hobbies (74%)
- being active through fitness activities and exercise (62%)
We’re spending more on needs rather than wants…
Because Millennials and Gen Zs feel like they have limited funds and job opportunities, 77% of them are prioritizing spending money on necessities than wants. 82% want to avoid debt or taking loans as much as possible, and 82%^ save money every pay period. 75% follow a monthly budget, and 87% avoid going over their budget.
…But our savings are still quite small
Even though Millennials and Gen Zs claim that they stick to a budget and try to save at least 25% of their savings, in reality, they are only able to save around 10% of their income.
Though they might not have reached their savings goal, 81% of the surveyed Millennials and Gen Zs have started taking steps to secure their future financially because they both believe it is important to know where their money goes.
Gen Z is becoming financially literate earlier…
Though they may not be financially independent yet, Gen Zs actively educating themselves and are ahead of the preceding generation. Filipino Gen Zs, on average, start saving money at 17 years old and investing at 21, while Millennials only began saving at 23 and investing at 27.
Moreover, 92% of Gen Zs plan to purchase an insurance plan in the next one to two years.
…While millennials are focusing on growing their money
Because Millennials are now becoming more financially secure and have even started their own families, they’re becoming more conscious and deliberate in growing their money.
In addition, 67% percent of Millennials have started investing in financial instruments, 79% are looking for ways to grow their money, and 77% are exploring diversifying their portfolios to mitigate risks.
So how do you navigate volatility?
Manulife’s report did not go into how the act of saving and investing affects Millennial and Gen Z’s mental health. But other studies have shown that Millennials who buy less and save more are generally happier. And so even though many of us don’t view saving money and investing as a self-care activity, getting personal finances in order can improve mental wellness.
With this in mind, Manulife is aiming to introduce more financial products, investment solutions and initiatives that support mental wellness to better address these generations’ overall being.
“Because of the pandemic, what should have been an optimistic period in their personal and professional lives has become a chapter filled with uncertainty and concern,” Henson said. “As we strive to navigate present realities, and forge a path toward a better post-pandemic world, we find hope in the fact that younger generations of Filipinos are taking concrete steps toward making every day better for themselves and their loved ones. We aim to help them future-proof their finances, so they can achieve their aspirations and live their lives to the fullest.”
