Apr 23, 2025
Gen Z consumers across the world are so financially stretched right now they’re financing burritos with buy-now-pay-later schemes.
But their financial lives could look remarkably different in just a few years, according to a recent report by the Bank of America.
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“In roughly the next five years, they will have globally amassed $36 trillion in income, and that figure is expected to surge to $74 trillion by around 2040,” says the BofA Global Research report.
Here’s why the youngest generation in the workforce is likely to see a huge bump in prosperity — and why it could slip through their fingers.
Higher income and higher spending
The Gen Z cohort earned roughly $9 trillion in aggregate income in 2023, the Bank of America estimates. As more of this cohort enters the workforce or climbs the corporate ladder, its aggregate income could quadruple by 2030.
This group is also accumulating assets at a rapid pace. At the end of 2024, the median Gen Z American had a net worth of $86,945, according to Empower. That’s 22% higher than the previous year.
Meanwhile, some young consumers are likely to experience a boost to their personal assets from inheritances. Cerulli Associates estimates that Gen Z could inherit roughly $11 trillion in assets by 2045.
However, this generation is currently spending money at a faster rate than other generations because of the cost-of-living crisis.
Gen Z household spending is growing at a faster rate than the rest of the global population, according to Bank of America’s analysis of credit and debit card data. By 2030, this cohort could be spending as much as $12.6 trillion a year in aggregate, compared to $2.7 trillion in 2024.
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This means many younger consumers are struggling to save and piling on expensive debt. On average, a Gen Z consumer has $94,100 in personal debt, far higher than millennials ($59,180) and Gen X ($53,255), according to a recent survey by Talker Research conducted for Newsweek.
For many people in their 20s and 30s, the best way to experience the full benefit of the great wealth and income transfer is to control debt and spending right away.
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Short-term sacrifices for long-term rewards
Excessive spending and borrowing could diminish Gen Z’s chances of accumulating wealth in the future, regardless of the trillions of dollars that are expected to flow to the generation over the next decade.
Creating a budget is an old but effective tool to limit discretionary spending. That can provide more room to either pay off debt or start accumulating savings.
It’s also important to resist phantom debt. Buy-Now-Pay-Later (BNPL) platforms present themselves differently from traditional credit cards, but the impact on personal finances is strikingly similar.
BNPL transaction volume is expected to surge 106% between 2024 and 2028, according to Juniper Research. This new form of debt is reshaping the consumer economy and could reshape Gen Z’s financial future if they don’t treat it the same way they would any other loan.
Considering the pace of change on the horizon, just a few years of resisting debt, living within their means, focusing on their career and building up savings could put a young person well ahead of their peers.
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Vishesh Raisinghani is a financial journalist covering personal finance, investing and the global economy. He's also the founder of Sharpe Ascension Inc., a content marketing agency focused on investment firms. His work has appeared in Moneywise, Yahoo Finance!, Motley Fool, Seeking Alpha, Mergers & Acquisitions Magazine and Piggybank.
Managing Money • Mar 30
