You’ve probably heard the stereotype that Gen-Z is all about instant gratification and overspending. But here’s the thing: that stereotype is just plain wrong. In fact, Gen-Zers are becoming known for their savvy money habits and using social accountability to help them stay on track.
Social accountability is the idea that if you make a commitment to someone else, you’re more likely to follow through. According to TikTok content creator Natalie Fischer, speaking to Bloomberg Wealth, for Gen-Z, making that commitment often takes the form of sharing their financial goals with friends and family on social media.
The term has been dubbed “Loud Budgeting.” Here’s how it works: let’s say you’re trying to save up for a new laptop. You might post about it on Instagram or Twitter, telling your followers that you’re determined to save up the money over the next few months. By publicly putting this goal out there, you’re creating a sense of accountability for yourself. Your friends, family and followers will see your progress updates, and they’ll know if you slip up and spend money on something else instead.
It might sound intimidating, but the truth is that using social accountability in this way is a potentially powerful tool for staying on track with your finances. And it’s not just about saving money, either - Gen-Zers are also using social accountability to keep their overall costs down.
For example, let’s say you and your friends are planning a night out. Instead of just going with the flow and spending money on whatever activities and drinks come up, you might set a budget and share it with your friends ahead of time. That way, everyone knows what to expect, and you can hold each other accountable if someone starts overspending.
The low-key, understated flexes of wealth that try to show off without showing off - known as “quiet luxury”, was previously popular with many TikTok users is now on the decline. Girl maths is also out. In contrast, broadcasting your intention to reduce spending (loud budgeting) is on the rise. So, you can try to rationalise that meal at a bougie café as “basically free,” but your friends will (hopefully) call you out on it.
Comedian Lukas Battle coined the term “loud budgeting” as a response to “quiet luxury”, and it blew up on FinTok – financial TikTok. In an interview with CNBC, Lukas shared that, while the term started out as a joke, there are real consequences to competing trends that encourage young people to spend money just to keep up with celebrities and influencers.
Of course, social accountability isn’t the only way Zoomers are staying financially responsible. They’re also using apps to track their spending, taking advantage of discounts and rewards programs, and seeking financial education wherever they can. With Debut, we’re building in services to help people keep track of their spending and save toward specific goals.
Though the concept is far from new, the renewed interest in opening the dialogue about money and spending among friends and family members is a big win, allowing people to make money-related decisions without feeling ashamed or embarrassed. Loud budgeting sends a message to a generation that saying “no” to unnecessary spending is okay.
FinTok presents many people who share an attitude that prioritises long-term financial stability over spending on luxury items. By sharing their goals and holding each other accountable, zoomers are proving that they’re far from the reckless spenders they’re often made out to be. Zoomers, Millennials, Gen-X and Boomers are all targeted with programming and advertising, encouraging them to spend ever more. As Lukas pointed out, “Everything is so commercialised now.”
So if you’re looking to get your finances in order, it might be time to start sharing your goals with the world. Who knows - you might inspire someone else to do the same.
Maybe you’re already quite open about spending conservatively, or you’ve been quiet budgeting all along? Let us know in the comments below.