A staggering 69% of Gen Z is using cash more now than they did 12 months ago — more than Gen X (47%) or the baby boomers (37%) — according to a recent report published by Credit Karma, a digital personal finance and credit service.
The findings show a rise in “cash stuffing” by Gen Z’ers learning how to manage their cold hard cash.
Cash or envelope stuffing is an old-school budgeting hack — commonly touted by renowned financial adviser Dave Ramsey — that is making a resurgence on social media as Gen Z struggles to get a grasp on finances.
The cash-reliant budgeting tactic directs people to divide their money into different categorized envelopes and only spend from the designated stash.
Any leftover cash then goes into savings.
“Typically, the money you use for cash stuffing is stuffed away inside an envelope or binder until you need it. If you can’t afford something with the cash you stuffed away at the start of the month, then you go without it,” Jacob Channel, a senior economist at LendingTree, explained to MarketWatch.
According to another Credit Karma survey, nearly half of Gen Z respondents said they relied on social media for financial advice — the most of any generation — while a quarter of them said they learned more about money from content creators than school or books.
As with other Gen Z trends, TikTok is leading the way, with the hashtag #cashstuffing having a whopping 1.1 billion views, while #cashenvelopes enjoys 727.4 million views and #cashenvelopestuffing 190.6 million.
Financial influencer, or “finfluencer,” Stephanie Garcia, 31, has accumulated 322,400 followers on TikTok by sharing videos of her weekly cash stuffing, plus other financial advice.
“I love doing it. It just really has helped me save,” Garcia told The Post.
Cash stuffing has allowed Garcia to pay off her credit card debt and begin building saving accounts for her children.
“When you leave money in your account, you swipe your debit card, and you don’t really realize how much money you’re spending because it’s not something tangible,” she explained.
“At first, I only cashed out for my bills and then, that way, I knew that the money that I had left I could spend, because I would always overspend.”
The straightforward saving method helped Garcia to get a better grip on her finances, she claimed, and she slowly began setting money aside every month.
She doesn’t use cash for everything and still has several bank accounts and credit cards but, she said, “it’s created a good habit.
“I know what I’m spending and I know where everything is going,” she insisted. “It gives me more control.
“Now I’m more mindful of how much I’m spending, and I get motivated when I see my envelopes filling up.”
Kimberly Dillon, vice president of budgeting app Cleo, told The Post that they’re seeing a big push of Gen Z’ers “making budgeting sexy or the frugal life sexy” with billions of budgeting-themed TikTok posts online.
In addition to cash stuffing, the expert said she has seen a rise in couponing, upcycling, buying secondhand, DIY-ing and engaging in side hustles, all in an attempt to save money.
Those trends come as a new study conducted by Insuranks found that, among millennials and Gen Z’ers, one out of three are not financially independent.
Another report from the TIAA Institute and the Global Financial Literacy Excellence Center at George Washington University showed that Gen Z is less financially literate than any of the four previous generations.
Recently, CBS also reported that millions of Americans are financially unable to retire, while experts continue to warn of a looming recession.
While perhaps not confident about managing finances, Gen Z apparently does understand its importance — especially when it comes to involving someone else in one’s economic picture.
Gen Z’ers and millennials are placing an increasing emphasis on financial matters in their romantic relationships by talking candidly about credit scores and savings early on, getting prenuptial agreements and calling things off over money issues.
Experts note that Gen Z’ers and millennials have lived through numerous eras of financial turmoil, including the financial crisis of 2008, the coronavirus pandemic, a rise in student debts and the current inflation surge.
As such, they are more concerned about money matters — whether or not they fully understand them.
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