"Where their parents may have turned to a financial advisor or their local banker, Gen Z investors plug into what they know best: TikTok and YouTube. The first generation to grow up in a post-internet world, nearly 40% of Gen Z investors surveyed said they get most of their finance tips from social media sites."

This is the first in a series of posts on investment trends among Gen Zers and Millennials.

Elias Smith began his investment career while he was still in high school, buying a few stocks on a recommendation. This advice didn’t come from a financial advisor or family member. Elias hadn’t joined an investment club at school or scoured financial news sites. He consulted his best friend, a fellow teen, and took a direct plunge into the stock market.

Like many in the cohort known as Gen Z, Elias took a nontraditional route to investing with the do-it-yourself ethos his generation is cultivating. About 28% of those born into Gen Z (between 1997 and 2015) hold stock or have retirement accounts, the highest recorded numbers for any generation at such a young age, according to a study by Next Gen Personal Finance.

The leading edge of Gen Z seems to be picking up the pace. About 60% to 65% of those aged 18 to 24 invest; in fact, they dedicate more money to investments and savings than anything else in their budgets besides food, a comprehensive 2021 study by GoBankingRates found.

Gen Zers — whose ranks include brave, independent thinkers such as Nobel Peace Prize laureate Malala Yousafzai and environmentalist Greta Thunberg — are willing to take more risks than their immediate predecessors, the Millennials, who were born between 1981 and 1996. Gen Zers are more likely than Millennials to buy stocks and cryptocurrency and less likely to invest in safer bets like exchange-traded funds (ETFs) or mutual funds, a finding from a recent survey of 1,400 young investors by The Motley Fool.

Where their parents may have turned to a financial advisor or their local banker, Gen Z investors plug into what they know best: TikTok and YouTube. The first generation to grow up in a post-internet world, nearly 40% of Gen Z investors surveyed said they get most of their finance tips from social media sites. Another 20% consult family or friends and about 7% turn to online forums like Reddit.

“Me and my best friend from high school really just played off one another. We would meet up and pitch one another ideas for stocks and then buy them,” explained Elias, who is now 22 and a senior at University of California Santa Barbara.

The results were mixed: “I bought shares of Tesla and some biotech company that was going to 3D-print a liver - one boom, one bust.”

The bust did not discourage Elias from educating himself and continuing to manage his own portfolio. He, like many of his fellows, has an eye to societal well-being, looking to invest in companies, for example, that are good stewards of the environment or work to create healthcare equity.

What’s more, Elias has lived through the Great Recession and the COVID-19 pandemic stock market crash. He worries about the state of the economy. Unlike his Gen X parents who came of age in the boom-boom 90s, he’s concerned about limited job opportunities and career options post-college.

Elias’s older brother, Nate, summed up this general outlook: “I think Gen Z sees the world that has been left to them by the generations before them, and is frustrated,” said the 25-year-old and fellow investor. “They are unhappy with many things they see, but also have a desire and a passion for trying to change things.”

At 25, Nate teeters right on the leading edge of Gen Z. He’s had time to consider the strengths of this group who will inherit an America plagued with political unrest and a polarized populace. He has reason for hope. Gen Z will soon be a force to be reckoned with as the nation’s largest and most ethnically diverse generation ever. At 27% of the population, this cohort has the power to force cultural, political, and financial change.

This is not an American phenomenon but a global one. A Bank of America Global Research study predicts that Gen Z’s combined global income is expected to increase five-fold before the end of the decade, from $7 trillion to $33 trillion. By 2031, their income will account for more than a quarter of the world’s total. And the consumer power of the giant cohort will accelerate as Baby Boomers and members of the Silent Generation hand down trillions of dollars of wealth.

North Carolina high school student Ella Gupta is well on her way to financial sovereignty. The 16-year-old author of Gen Z Money $ense: A Personal Finance and Investing Guide opened her own retirement account at age 14 and has spent a lot of time thinking about her generation’s impact. She shared those thoughts earlier this year in an essay for Barron’s:

“When I think of Gen Z, I think of transformation. My generation is driving change across all spectrums, reshaping the way things have traditionally been done and disrupting established paradigms. I am bullish on the future of Gen Z, and I am confident that we will be the most financially successful generation ever."


Photo courtesy Nate Smith (left), with his brother, Elias.

Tamara Kerrill Field’s writing and commentary on the intersection of race, politics and socioeconomics has been featured in USNews & World Report, the Chicago Tribune, NPR, PBS NewsHour, and other outlets. She lives in Portland, ME.