Money Wellness
Illustrated image of a Gen Z looking worried about money. Financial stress takes a toll on mental health
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calendar icon13 May 2024

Financial stress takes a toll on Gen Z's mental health

According to the findings of a new study, published in the Daily Mail, 40% of Gen Z experience heightened anxiety, stress, or worry after paying basic expenses like rent. And three-quarters believe they would suffer a ‘mental breakdown’ if faced with an unexpected £300 expense.

The study, conducted by RiseUp, highlights the financial challenges faced by Generation Z.

Despite claiming to have financial knowledge, 68% of Gen Z's report feeling anxious in the days leading up to payday, often feeling embarrassed about their inability to save.

And with 38% of those surveyed left with less than £100 at the end of each month, they remain trapped in a cycle of constant worry about their financial stability.

This concern about running out of money is not unfounded, as 56% of those surveyed admitting that money worries significantly impact their mental health.

The emotional rollercoaster of payday marks a stark contrast in emotions, with just 9% feeling anxious compared to 27% feeling relaxed and 26% feeling positive.

However, this sense of relief is short-lived, with feelings of positivity dropping by 20% just one week later.

By week three of the monthly pay cycle, 56% feel worried, anxious, and stressed about money.

The study also reveals that women are particularly affected, with 64% admitting to feeling anxious compared to 43% of men.

And this emotional cycle also affects spending habits, with individuals becoming increasingly hesitant to indulge in non-essential purchases as the month progresses.

The impact of financial stress extends beyond mental health, with 40% of Gen Z's saying that unexpected expenses alter their fitness routines and friendships.

Yuval Samet, chief executive of RiseUp, emphasised the need for better support and resources to help Gen Z manage their finances and improve their overall wellbeing. He said: "Financial stress can take a huge toll on our mental health, and RiseUp's research shows that Gen Z has taken the brunt of this stress out of all other generations.

However, there is a distinct lack of support when it comes to managing their finances in relation to their wellbeing. By providing them with the tools, knowledge and community support they can switch their mindset about money and feel financially confident."

Avatar of Caroline Chell

Caroline Chell

Caroline has worked in financial communications for more than 10 years, writing content on subjects such as pensions, mortgages, loans and credit cards, as well as stockbroking and investment advice.

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