There is a particular irony to the fact that after being in various lockdowns for two years now we can go out but some of us do not have the funds. PayPal’s Gen Z Financial Wellness Study1 found that the current ‘cost of living crisis’ is the leading cause of anxiety for a quarter of young adults, with three quarters (76%) feeling compelled to change their spending habits to navigate it.
Whilst I’d love to continue to search for the irony, clearly it’s something I can’t afford in this current economy. We all want to go and have a good time—but now—that comes at an increased cost. Inflation is at an all-time high and VAT has bounced back which means that eating out has become much more expensive. PayPal’s report found that going out less will be the first cut-back for over half of Gen Z (54%), but the icing on the cake comes when you decide to stay home to save money and watch your favourite shows when your streaming subscription cost has likely gone up too.
While we’re all feeling the pinch more than ever, it’s amazing to see that the top thing that Gen Z refuse to compromise on is setting money aside for savings (42%). In my opinion, now more than ever, we need to make saving a priority irrespective of how much the cost of living has gone up by. If harder times are upon us than what we are facing now, we’ll be glad to have some cash to hand. Savings are so much more than saving for your first house, it’s also having an emergency fund in case of job loss or a family emergency or anything else you deem fit to cause a sudden financial imbalance in your life.
Now to put away my financial violin, and to put on my Finance Coaching hat. Here are my tips to help you make the most of your money in the current cost of living crisis:
Save money on food shopping
It's time to get thrifty. The items that we buy so often now come with a higher price point. There is nothing wrong with buying supermarket own brands. Everything we use doesn’t have to be a branded product and that goes for our food shopping as well. In addition to this, so many supermarkets have loyalty cards and as someone who uses them, trust me they can make all the difference. Make sure if there is a loyalty card available at somewhere you shop on a regular basis, you have it at the ready.
Create a budget – and stick to it!
In order to continue to make things such as saving a priority, 44% of Gen Z are creating budgets to stick to - which is the smartest thing we can do right now. But the most important part of this tip is the sticking to it. If you’re like me, I use PayPal for my online shopping, so the PayPal app is a great way for me to keep track of my spending with PayPal and feel in control of my money. It’s simple and easy to see what, where and how much I’m spending – all in one place.
This will also be helpful if you’re working towards a financial goal, as when you have an overview of your spending activity in one place you can start taking notes on any unnecessary payments. You’ll begin to see spending habits and find the places where you can make savings to put towards any savings goals you may have.
Make the most of shared plans
If you spoke to everyone you consider to be a close friend or your immediate family, you’d be shocked by how many people have individual subscriptions for streaming services. Make the most of streaming services that have family or shared plans. I used to pay £9.99 per month as an individual to stream music, but now I have a family plan and I pay £5 a month. Get savvy with your money and begin communicating with your loved ones about streaming services. You won’t regret it.
Start using cashback services
I questioned what my life was like before cashback. It wasn’t a simpler time that’s for sure. I try to factor cashback into any purchase I make where it’s available. Cashback is literally what it says on the tin, cash back on your purchases. No matter how small you think the percentage is, it counts and adds up so make sure you’ve signed up to a cashback service that has all the retailers you love so you can start getting a little bit more for your money.
Hunt for deals
One of my favourite tips is to always search for discounts and apparently Gen Z are in agreement - with 43% of Gen Z planning to look out for discounts in the current climate. In this economy, no one is above finding a discount. It doesn’t even have to be time consuming, sign up to Honey and it’ll do the hard work for you as it automatically finds and applies coupon codes across a lot of websites. Now is the time to make the most of your money and make it stretch further.
Meet friends in free places
There’s no shame in doing free things with your friends, especially when the sun makes a guest appearance. Inexpensive picnics, bike rides and long walks are a few ways you can meet up with friends and still have a good time. A drive to a nearby beach or nature spot doesn’t hurt either. Fun doesn’t have to be expensive, it just has to be with friends.
1 PayPal’s Gen Z Financial Wellness Study survey of 1,000 UK Gen Z adults (aged 18 – 25) and 1,000 Millennials (aged 25-41) conducted by OnePoll in April 2022