New research suggests younger generations are financially better off than generations before them. But purchasing power doesn’t tell the whole story. What does this mean for financial services?

Gen Z is growing up with uncertainty as a constant presence. As a mobile-first generation, they experience geopolitical tensions, climate change and economic instability in real time. Meanwhile, they face very tangible challenges: Think of high living costs, student debt, insecure employment and an inaccessible housing market.

Yet new research from Statistics Netherlands (CBS) challenges the assumption that younger generations are financially worse off than their predecessors. According to CBS, younger generations generally enjoy greater purchasing power than previous generations did at the same age. At 24, Gen Z’s average purchasing power is €30,200, compared with €25,700 for baby boomers. 

But does having more purchasing power necessarily mean being better off?

Despite their stronger purchasing power, millennials and Gen Z generally accumulated less wealth before the age of 30 than previous generations. Homeownership also tells a different story, with younger generations facing greater challenges in accessing the housing market.

This reveals an important distinction between having money available today and being able to build long-term financial security. Especially if we consider how younger people experience their financial situation. Research among Dutch young people aged 12–29, found that 81% experience concerns about money, while 64% sometimes struggle to make ends meet. 

When the bigger picture feels unpredictable, being able to influence your immediate future becomes more important. And financial security becomes part of that because money can also offer a sense of agency: knowing what you have, being prepared for unexpected costs and feeling that you are making progress. For previous generations, milestones such as buying a home, starting a family and building wealth often provided a relatively familiar framework for financial planning. Today, those milestones may come later, take different forms or remain out of reach for some.

Banks and financial services have traditionally organised many of their products and services around established financial milestones: a first mortgage, a joint account, investments and retirement planning. These needs haven’t disappeared. But they don’t necessarily reflect the immediate priorities of younger customers. For banks looking to build stronger relationships with Gen Z, the opportunity lies in offering solutions that fit their everyday reality.