Finance

Gen Zers are investing their way out of the 9-to-5

Published

7 hours ago

August 12, 2024

Gen Zers are investing their way out of the 9-to-5

The finance guru Dave Ramsey famously said that if Americans wanted to build wealth, they should give up their morning coffee. But spend any time in certain corners of personal-finance Instagram and TikTok and you’ll see women indulging in sleek caffeinated beverages. They swirl whipped cream on their tall iced coffees, brew black-sesame-matcha lattes, and show off hot chocolate and pastries as they promote strategies to save, invest, and make the most of their credit-card points. These women talk openly about being rich and wanting to help other women become rich too.

One of those influencers is Tori Dunlap, the founder of a financial-education company called Her First 100K. She aspires to get as many young women as possible investing and to debunk the notion that in order to build wealth they need to deprive themselves of things they enjoy. In a video on Instagram, she considers Ramsey’s advice, then erupts into a scream. “It’s not the latte that’s keeping you from saving money,” she wrote in the caption. “It’s the systemic oppression.”

Just a handful of years ago, Dunlap, who was born in Tacoma, Washington, was working a job in marketing and dealing with a toxic boss. Thanks to an emergency fund she’d grown, she was able to quit and start focusing on building Her First 100K — named for Dunlap’s goal of amassing $100,000 in wealth, which she achieved by the time she was 25 by budgeting and investing.

Now, Dunlap, 30, has over 2 million followers on Instagram, hosts a top-rated US business podcast, and is the author of the best-selling book “Financial Feminist.” She also launched a platform called Treasury, which says it has helped women invest over $80 million in the stock market. Alongside creators like Mrs. Dow Jones, Simran Kaur, and Rachel Rodgers, Dunlap is a leader of a new wave of personal-finance education focused on teaching Gen Z and millennial women the fundamentals of earning, paying off debt, and investing, using a savvy blend of traditional financial advice, irreverent social commentary, and high-travel memes. You can think of it as financial education for the “lazy-girl job” generation — those who decry the corporate hustle and seek out low-stress jobs that don’t take over their lives. In one video, Kaur, the New Zealand-based creator of Girls That Invest, does her makeup in front of a mirror as she discusses how she’s using her investment earnings to build her own trust fund to live on. The message? You too can invest your way out of the 9-to-5 life.

If you ask these women, however, they’ll say the trend has nothing to do with being lazy and everything to do with giving women the tools they need to take control of their financial destiny. “We’re taking something very inaccessible and making it accessible,” Dunlap said. If men can use their financial savvy to get rich, then so can women. And in a world where many Gen Zers and millennials expect to be working well past retirement age, the advice is finding an eager audience.

On the first day of her first full-time job out of college in 2018, Haley Sacks was asked to fill out her health insurance and 401(k) contributions. “I really wanted to make a good impression, so that night I went home and did what any self-respecting millennial would do,” the New York native said. “I looked on YouTube for information, and I was really taken aback by what I found.”

Nearly all the financial-education content geared toward women focused on home-economics fare like saving and budgeting, she said. Meanwhile, the content she actually needed, which explained the fundamentals of investing, not only was “very dry” but seemed primarily made with a male audience in mind. “I couldn’t really find anyone who was teaching money the way that I wanted to learn it,” Sacks said. “So I became her.” Now, six years later, Sacks, who goes by Mrs. Dow Jones on social media, has 1 million followers on Instagram, where she posts pop-culture-inflected videos on topics like how to predict layoffs at your job and why the Cartier Love bracelets Kylie Jenner is famous for wearing may not be a good investment.

People like Sacks and Dunlap aren’t the first female celebrity personal-finance experts. Sacks pointed to Suze Orman — the pioneering personal-finance guru, author, and TV host — as someone who “walked so all of us could run.” But until recently, women looking to wrap their heads around the intricacies of high-interest savings accounts and low-cost index funds had scant few options that spoke directly to them. Personal-finance education in US high schools used to be rare — though it’s gotten better in the last few years with half of US states now mandating it. And women-specific financial-education literature tended to focus less on investing in real estate or negotiating a higher salary than on learning how to curb one’s spending on supposedly “frivolous” items like coffee, manicures, and haircuts. The message, Dunlap said, boiled down to: “Men get to be millionaires by making more money and being the fullest version of themselves. The way to become a millionaire for women is to basically hate your life.”

I couldn’t really find anyone who was teaching money the way that I wanted to learn it. So I became her.
Haley Sacks

On one level, these influencers are offering well-trodden financial advice packaged for a new audience: Dunlap’s book has sections on building an emergency fund, getting out of debt, and investing for retirement. She said women comprise 95% of her audience. “We joke that it’s largely girls, gays, and theys,” she said. Sacks, who calls herself a “zillennial finance expert,” said that her content is aimed at people of all genders but that women tend to gravitate to it because of the person who’s talking. “We all have the same message,” Sacks said. “It’s sort of like finding the right trainer who motivates you.”

These influencers do break from tradition in a few key ways. Citing high interest rates, rising home prices, and a booming stock market, Sacks and Dunlap have made the case for renting instead of buying. In “Financial Feminist,” Dunlap recommends readers focus on building a three- to six-month emergency fund before paying off debt so they’re prepared for a layoff or dangerous home situation. Sacks recommends young people job-hop to keep up with inflation and cost-of-living increases if necessary. “You should be making 15% more every single year,” she said. “And if you’re not making that at your current job, then you should change jobs.” (Research from the Economic Policy Institute indicates that since 2007 US employees have received an average wage increase of 3.9% a year.)

Rita Soledad Fernández Paulino, a California-based money coach and creator focused on women, BIPOC, and LGBTQ+ people, said their goal is to help people become “work-optional” by leveraging their investments. “I like the idea of everyone working because they want to and not because they have to,” they said.

Leah Sheppard, a professor of management and associate dean for equity and inclusion at Washington State University’s Carson College of Business, sees this wave of financial education as a reflection of an awareness among Gen Zers and millennials that the boomer-era version of the American dream — where you work your way up the ladder for 40 years at a single employer and put away enough to retire — no longer applies to them. “Young people are thinking, ‘When will I get to a place where I don’t really have to worry about money?’” she said. “If they’re thinking, ‘Traditional employment is not working well, I don’t want to start a business’ — well, what’s the other way? And it’s probably getting really smart about how you save money, taking the money that you are saving and investing it and building wealth.”

I like the idea of everyone working because they want to and not because they have to.
Rita Soledad Fernández Paulino

Sacks sees it as a matter of young people wanting to take the future into their own hands. “You have to be more self-reliant now than our parents ever had to be,” she said.

Kyla Scanlon, the author of the 2024 book “In This Economy?”, sees the interest in financial-education content on social media as symptomatic of a curiosity about alternative revenue streams, spurred by the rise of fintech apps like Robinhood and populist financial movements like crypto and GameStop. “People are looking at the market. They’re looking at different income sources, Airbnb, the gigification of everything — and then just how do you have passive income outside of traditional income?” Scanlon said.

For young men, this often takes the shape of riskier investments like sports gambling, crypto, and meme stocks. Young women, on the other hand, are turning to more tried-and-true tactics.

In a survey of 2,000 adults conducted in July 2023, Fidelity Investments found that Gen Z women were more likely to say they participated in the stock market than any other age group, with 71% of women ages 18 to 26 saying they had invested, compared with 63% of millennial women and 57% of boomer women. These figures dovetail with an uptick in the percentage of people under 35 who held stocks and retirement accounts in 2022 compared with 2019, according to the Federal Reserve’s Survey of Consumer Finances, though the Fed doesn’t break these figures down by gender.

Whether the goal is to retire early or to job-hop your way to a six-figure salary, this wave of financial advice departs from the “lean-in,” “girlboss” flavor of feminism that dominated conversations about women and work in the 2010s. “We’re just more disillusioned with corporate,” Dunlap said. “We’re more disillusioned with the way we make money.”

Instead, it’s advice for a generation of women who see their experiences reflected in memes like the “lazy-girl job.” “The lazy-girl thing is just like, ‘Oh, give me a little bit of rest in addition to my work,’” Dunlap said. “I think that’s completely reasonable.”

I can have wealth too. You can have wealth too. It’s not a you problem; it’s a we problem.
Rita Soledad Fernández Paulino

But talking about this stuff in public as a woman or queer person can be fraught. Dunlap said she gets “called every insulting thing you can call a woman on a daily basis” and has been on the receiving end of death threats. She said people aren’t used to seeing women talking in public about money, and especially not about being rich. “We have different expectations for how men and women should behave, especially around money,” she said. “Women shouldn’t want it. You should be grateful for the things you have.”

Other women BI spoke with said they faced harassment. “There’s a certain group of men who just don’t like women,” Scanlon said. But for the most part, the influencers stressed that their content was resonating with the people it was supposed to resonate with. “The comments section on any video is a mess, but it’s also the most supportive, lovely thing,” Dunlap said. “So many women, championing me, championing each other, championing themselves.”

The experts BI spoke with all had their own ways of describing the movement. Fernández Paulino said they see themself as belonging to a community of people who approach money and finance in a way that acknowledges the systemic issues that interfere with people’s wealth and wellness — such as the economic effects of structural racism and transphobia, or the fact that American women weren’t allowed to own a credit card or take out a mortgage in their own name until the 1970s. “For me, it’s like, I can have wealth too. You can have wealth too. It’s not a you problem; it’s a we problem,” they said.

Dunlap invented her own term to describe it: financial feminism. “It’s this idea of getting yourself financially to a point where you are stable, safe, and you have enough wealth to have options, and then using that wealth as a tool to make an impact,” she said. In other words, she wants to help women navigate the economic systems we’re all swimming in, so they can help other women by changing those systems from within.

Emilie Friedlander is a journalist and editor from Brooklyn, currently based in Philadelphia. She co-hosts The Culture Journalist, a podcast about culture in the age of platforms.

Click to comment

Finance

I'm a recent grad who gave up a six-figure job at JPMorgan without another offer. It all came down to career satisfaction.

Published

14 hours ago

August 11, 2024

Press Room

I'm a recent grad who gave up a six-figure job at JPMorgan without another offer. It all came down to career satisfaction.

This as-told-to essay is based on a conversation with Nick Rutherford, a recent University of Pennsylvania graduate, who interned at JPMorgan Private Bank and is starting at Unilever this fall. It has been edited for length and clarity. Business Insider has verified his offer letters.

I didn’t have a career plan sketched out before joining university. I wasn’t passionate about math or science and thought that I would end up going to law school at the end of my bachelors.

I majored in political science but took classes at the University of Pennsylvania’s Wharton School of Business. Being around career-focused students who always talked about their résumés and internships challenged me to start caring about those things.

I tried out a variety of internships in college: I worked at a non-profit media outlet, an advertising company, and a think tank.

My strategy has always been to add 100-150 jobs to a spreadsheet with their details and apply to five each day until I run out. In my final summer before graduation, I managed to land three internship offers — from a consulting company, a consumer goods company, and JPMorgan.

When I got that phone call that I got the JPMorgan internship, it was so exciting and I felt really grateful. I would be working in their private banking division in Seattle. I wasn’t too nervous because they made it clear that even if we knew nothing, they could teach us.

Despite everything I have heard about banking from other friends, the interns and even the analysts we worked under did not have to work beyond our hours or on weekends. I didn’t find that my internship was taking a toll on me — physically or mentally.

When it came to getting full-time return offers, I expected to get it because I thought I did a good job and felt like I deserved it. They picked three out of five in my cohort, including me.

But by the time the offer rolled around, I think I had already had this lingering sense that this wasn’t the environment I wanted to be in long term.

I definitely had mixed feelings about the offer, even though it put my starting salary at $100,000 a year.

The number one factor in my pros and cons list was financial stability and knowing that a six-figure salary was one signature away. I don’t come from money, and my mom is a single parent to me and my three siblings. I was able to attend university because of several scholarships.

Nick Rutherford and his siblings

Nick Rutherford

It was a hard number to say no to, but I have a strong growth mindset and I care a lot about how I spend my time and who I’m becoming. I wanted desperately to be in a place where I feel stimulated and I’m interested in the work I’m doing.

I was doing well, but I didn’t get that feeling at my internship. I didn’t have any bad experiences — there was just not enough work that I really enjoyed, like building models.

I didn’t have any other offers. The alternative was job hunting from scratch, not knowing what I would land and whether the offer would even come close to what JPMorgan was paying.

I thought, “What is the worst that can happen if I turn this down?” The answer was that I won’t have a job for a few months, but I’ll find one. I consulted my family, and one professor from my business school about my decision and turned it down.

Once I sent that email, I did not wallow about my decision. I went right back and found more jobs, made my spreadsheets just like before, started going for interviews. In a couple of months, I applied to a role at Unilever for a leadership program.

I used a lot of the same skills that helped me land the finance internship in my Unilever interviews.

I landed an offer at the company’s New Jersey office and am due to start working this fall. The pay was a significant cut from my first offer, but I see it as: If I enjoy what I’m doing, the money will come.

There was definitely the prestige factor of having JPMorgan on my résumé for a few years, but I just didn’t care that much about it as compared to what else I was looking for in a job.

I think that’s how many other Gen Zs are viewing work nowadays. They no longer want to give away 40 years of their lives for an annual paycheck. We’re being a lot more demanding about wanting a company culture and more than just wages.

Do you have a career story to share? Get in touch with this reporter at shubhangigoel@insider.com

Finance

Gen Z Isn’t Too Young for These 3 Financial Regrets: How They Can Overcome Them

Published

21 hours ago

August 11, 2024

Press Room

Gen Z Isn’t Too Young for These 3 Financial Regrets: How They Can Overcome Them

Delmaine Donson / iStock.com

Though the youngest end of Gen Z are not old enough to live alone and work full time, those on the older end are well into their 20s, working and trying to survive in the world. Though they may be young, they’re not too young to have financial regrets.

There’s nothing quite like getting out into the world on your own to teach anyone just how challenging it is to manage finances and plan for the future at the same time.

GOBankingRates spoke with several Gen Zers about their financial regrets, what they learned and their advice for others.

Check Out: I Followed Mark Cuban’s Genius Advice and Am on Track To Become a Millionaire

See More: 7 Reasons Gen Z Must Speak to a Financial Advisor Before Spending $10,000 or More

Earning passive income doesn’t need to be difficult. You can start this week.

Regret: Not Saving or Budgeting Money

Lena, a 24 year-old nanny based in New York, had her parents’ help saving the money she received as gifts from birthdays, graduation gifts and small summer jobs when she was young. But when she arrived at college, she quickly realized she didn’t have the budgeting skills she needed.

“Unfortunately I had no idea what to do with [the money], and blew through it before I graduated. Now I’m living on my own, paying my own rent and bills and I wish I had saved some of that money for now when I really need it,” she said.

Read Next: 6 Things the Middle Class Should Sell To Build Their Savings

Solution: Find a Budget That Works for You

It was in college that Lena learned budgeting skills. Now, she goes over her credit card statement in detail at the end of the month and uses a spreadsheet to add up her purchases in a number of categories. “This makes me super aware of how I’m spending my money, keeping me accountable and reduces making stupid purchases,” she explained.

She stresses that using a credit card is only useful if you pay it off at the end of every month, but it has the added bonus of building great credit.

Now, she has a savings account that she can only contribute a small amount to after expenses, but she is happy to be on the right track.

“If I had been doing that in college, I would’ve been more aware of my spending habits and could have made better choices. I know I spent a ridiculous amount on Starbucks, food delivery and nights out.”

Regret: Taking On Student Loan Debt

Mary McClelland, a Gen Z artist living in New York City, was unable to finish college after the COVID-19 pandemic hit. This left her only with an associate’s degree and $100,000 worth of student loan debt, for, she said, “what feels like no reason, and little to no hope of being able to pay it off in my lifetime.”

Solution: Community College

If she could have done it differently, she would have gone straight to community college after high school and joined a trade school or international program instead of a four-year college.

“College used to be a guarantee to a career and a seemingly comfortable life, but that’s just not the case anymore,” she said. “It seems like everyone my age is struggling financially, degree or no. It’s not like me to have a regret about the way my life has worked out because it’s ultimately brought me so much experience.”

Despite her regret, she is grateful for the life experience she gained. McClelland’s advice to others is: “Believe in yourself and the decisions you are making for yourself. You did what you thought was best for you at the time. It’s OK to live and learn, forgive yourself.”

Regret: Spending Too Much Money on DoorDash and Dining Out

Solveig Q., a 25-year-old master’s student and bartender in Colorado, regrets how much money she has spent on DoorDash.

“I probably spent up to $300 a month on DoorDash and sometimes more, which is $3,600 a year. I wish I’d saved that money and meal-prepped instead,” she remarked.

Solution: Meal Prep

Solveig did finally get a handle on her spending and changed her habits. “Over the last couple months I started meal prepping more and have saved $600 and I’m eating healthier. I would tell the younger generation that meal prepping is so much better for you and you will save so much money.”

She saves to eat a nice dinner out once a month. “I understand it’s hard to balance school, work and eating healthy,” she said, “but once you get in the hang of meal prepping it’s fun and a lot easier.”

Sometimes the best financial teachers are the mistakes you make along the way. These Gen Zers are still young enough to get past their financial mistakes and find solid footing along the way.

More From GOBankingRates

This article originally appeared on GOBankingRates.com: Gen Z Isn’t Too Young for These 3 Financial Regrets: How They Can Overcome Them

Finance

Recession? Really? Come on…: Morning Brief

Published

1 day ago

August 11, 2024

Press Room

Recession? Really? Come on…: Morning Brief

This is The Takeaway from today’s Morning Brief, which you can sign up to receive in your inbox every morning along with:

And just like that, everyone is a recession expert.

Two weeks ago, most self-proclaimed finance experts hadn’t uttered the word recession since it was fashionable in late 2022/early 2023.

From late July to early August, the prevailing sentiment of those seemingly in the know was 1) Nvidia (NVDA) shares were due for another 50% move after earnings on Aug. 28; 2) a 10% year-end rally for the S&P 500; and 3) a 100% move in Nvidia’s stock price in 2025.

Yet here we are, with the pros scaring the heck out of everyone the past week on the potential for a recession after a “bad” jobs report last Friday. Two top Wall Street banks raised their recession probabilities this week, for example.

These pros have voiced their concerns on TV, social media, and in research reports, but they also conveyed them to global trading desks. Markets were pushed into choppy seas as crowded AI trades such as AMD (AMD) have been dumped, with no nod to their underlying fundamentals.

All this recession talk feels like BS to me, an excuse to shake out the average investor so institutional players could get back into high-flying names at cheaper prices. Everyone does know that a recession often means negative economic growth, right? Or a significant slowdown in the economy that lasts quarters or even years?

So the US economy is going to go from 2.8% second quarter GDP growth and a long period of steady expansion to slightly negative growth or worse sometime within the next six months? An economy still creating a good clip of jobs each month is going to begin producing job losses in the near future?

Where is the evidence to support this? What’s the trigger for it? Don’t hit me up on X, formerly Twitter, and say it’s interest rates because the economy has been doing just fine during this high rate period.

Lost in recession BS this week was an ISM services report, which includes data on business activity, new orders, employment, and supplier deliveries. The index clocked in at 51.4%, up from 48.8% in June.

Numbers over 50% are seen as positive for the economy. Most companies in the report said business was either flat or expanding gradually.

Then, initial jobless claims totaled a seasonally adjusted 233,000 for the week — a drop of 17,000. The Street was looking for a print of around 240,000.

Corporate earnings season has gone quite well too. The majority of well-known public companies are easily beating sales and profit forecasts, not shocking the masses with giant misses. Outlooks have been solid.

That’s recessionary? Come on!

Now, I am not going to sit here and blow smoke and say everything is peachy. Many households are struggling to make ends meet because of sticky inflation, something I was reminded of when chatting with P&G’s (PG) CEO Jon Moeller a week ago.

I think the interview by Yahoo Finance’s Brooke DiPalma at the NYSE with Dine Brands (DIN) CEO John Peyton was also eye-opening on this front.

“It’s a value war. It’s a fight for share of wallet. … At a time when our target guest is dining out less, we have to make sure that when they do choose to dine out — IHOP or Applebee’s or Fuzzy’s are their first choice,” Peyton said.

The same goes for DiPalma’s exclusive interview with Molson Coors (TAP) CEO Gavin Hattersley.

“Consumers [are] making different pack sizes choices,” Hattersley said. He said this behavior has been going on “for a while” and is “pretty consistent through through Q2.”

Conversations I had this past week with top leaders further shed light on these macro challenges.

Disney (DIS) CFO Hugh Johnston told me demand at its theme parks tailed off in the final few weeks of the quarter. The company sees this slowdown persisting for the next few quarters.

“We certainly see consumers behaving in a way — I wouldn’t call it recessionary necessarily — they’re watching their pennies a little bit more,” Johnston said. Lost in the sauce, though, was a strong quarter for Disney’s streaming businesses. In a recession, people usually cut unnecessary expenses.

Ralph Lauren (RL) CEO Patrice Louvet told me (video above) this when I asked him if the consumer is behaving recessionary: “I think it’s pretty clear wherever you look that the overall consumer is being pressured by the cumulative effect of inflationary pressures and interest rates. As far as our core consumer is concerned, we actually find them to be very resilient.”

The company still notched sales growth in its North American stores.

All in all, you don’t get the sense the economy has already jumped over a cliff and is falling to the ground. As a result, it’s hard to justify some of these severe down days we have witnessed in markets this week.

What appears to be unfolding is a gradual cooling in the economy that could prove short-lived, especially if the Fed cuts rates, as Cognizant (CTSH) CEO Ravi Kumar told me on my Opening Bid podcast this week.

Labor market developments of late “seem more consistent with post-reopening normalization and gradual rates drag than any current shock or accelerating weakness but the risk is present,” said 22V Research strategist Peter Williams in a note this week.

I think that’s a fair assessment. What’s not fair is all this recession hysteria talk.

Three times each week, I field insight-filled conversations with the biggest names in business and markets on my Opening Bid podcast. Find more episodes on our video hub. Watch on your preferred streaming service. Or listen and subscribe on Apple Podcasts, Spotify, or wherever you find your favorite podcasts.