7 February 2024Deutsche BankResearch Global Strategy Thematic Research Date Gen Z: Soft living, but financially prudentNow that Gen Z has just begun to outnumber the Baby Boomers in the US, a key question for corporates and asset managers is how the younger generation's changing financial habits will affect spending and investment outcomes. We see changes in both - just not in ways most people expect.In this piece, we note the 'soft living' phenomenon that is contributing to Gen Z's financial choices. This involves the greater prioritisation of life over work. Yet at the same time, our surveys show Gen Z wants to save and invest to ensure financial security. They tend to balance their books each month, and they buy homes and make investments quicker than did Millennials.We believe Gen Z's more traditional values of financial prudence will likely stick. They are more insecure about their finances and yet they are financially literate, have money to invest, and appreciate risk. This is likely to make them more proactive at building wealth to finance a balanced life.Gen Z's changing impact extends to politics. We look at what their different views mean ahead of the US presidential election and UK general election.The big takeaway is that Gen Z appears to be more conservative with both their money and political choices compared with the previous generation. In some ways, that resembles older generations. It seems some traits come full circle.Note: We would like to thank Anthony Chaimowitz and dbDIG for providing the data behind Gen Z behaviour.Olga CotagaResearch Analyst+44-20-754-15910Luke Templeman, CPAResearch Analyst+44-20-754-10130Deutsche Bank AGIMPORTANT RESEARCH DISCLOSURES AND ANALYST CERTIFICATIONS LOCATED IN APPENDIX 1. MCI (P) 041/10/2023. UNTIL 19th MARCH 2021 INCOMPLETE DISCLOSURE INFORMATION MAY HAVE BEEN DISPLAYED, PLEASE SEE APPENDIX 1 FOR FURTHER DETAILS.Distributed on: 07/02/2024 10:53:07 GMT7T2se3r0Ot6kwoPa7 February 2024Thematic ResearchPage 2Deutsche Bank AGTable Of ContentsKey actions asset managers need to take to win over Gen Z clients..................3Key statistics about Gen Z.................................................................................3Gen Z has already overtaken Baby Boomers in the US......................................4'Soft living' combined with financial prudence..................................................4'Soft living' does not necessarily mean 'soft saving'.........................................5Prudence may come from financial insecurity...................................................6Financial prudence drives precautionary savings..............................................7Precautionary savings translate into investments, which then tran...................8Gen Z investors are financially literate, have money to invest an.......................8We believe Gen Z's optimism will drive further savings...................................10Hom...
