Nearly 70% of Gen Z would consider professional financial advice in contrast to the 18% who are currently receiving advice or have received advice in the past, new research has found.
The Financial Services Council’s latest research Money & You: The Financial Lives of Young New Zealanders paints a picture of the financial wellbeing of New Zealand’s newest adults at a crossroads, centering on the financial situations of 18-to-25 year old “Gen Z” Kiwis.
The report found that while 69% would consider advice, most don’t take it up, with 9% currently receiving advice and another 9% having received it in the past. The remainder, 13%, would not consider advice.
It says an earlier FMA report reveals a tension between openness to financial guidance and discomfort discussing finances. “This discomfort is likely to hinder engagement with professional support…”
The FSC also notes this cohort is highly engaged with KiwiSaver, with 96% being enrolled and 80% having checked their KiwiSaver fund in the last year. It also finds that Gen Z are savers, with 62% saying they would save their money if they had extra funds or a pay rise.
However despite these positive aspects of this cohort’s financial behaviours, they are deeply uncertain about making financial decisions and anxious about the state of the world.
“This generation’s confidence in financial decision-making has declined from 42% in 2023 to 35%, with only 13% saying they are extremely confident in financial decision-making,” says FSC CEO Kirk Hope.
“As this generation navigates economic situations for the first time, like many New Zealanders in the current economic climate, 93% are concerned by cost of living and 58% would rely on friends and family if unemployed,” he says.
…building confidence in financial decision-making can be addressed by encouraging young adults to reach out to professional financial advice…
“Learning about financial resilience and building confidence in financial decision-making can be addressed by encouraging young adults to reach out to professional financial advice and having financial literacy taught to them whilst at school.”
Life insurance uptake
He notes too that this cohort “…lacks confidence in decision making involving insurance, with only 33% being somewhat or very confident to do so.”
The research shows that 37% of this cohort have health insurance, while a little under a quarter [24%] have life insurance. This drops to 7-8% for other life insurance products.
“The FSC’s ongoing call to remove Fringe Benefit Tax on employer-provided health and life insurance would open the door for more working Kiwis to gain protection through workplace benefits,” Hope says.
Click here to read the full report.