Gen Z: 4 'Necessities' That Are Actually Luxuries Breaking Your Budget (No, It's Not a Latte)
For younger generations, it’s all about convenience. However, convenience also comes with a price.
“Many Gen Z clients view convenience as a necessity,” explained Laci Graul, financial advisor at Edward Jones. “As a Gen Zer myself, I know that these luxuries disguised as necessities have a sneaky way of showing up in our budgets without us noticing.”
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According to Gen Zers, the following “necessities” are more like luxuries.
Subscriptions
Many consumers ditched cable television years ago and turned to services like Netflix to save money. But these subscription services have increased their prices over the years, and if you have several at once, those costs add up.
“The reality is, these subscription-based services add up fast, and paying for Hulu, Netflix, HBO, Apple and Prime every month drains your account by roughly $700 annually,” said Brennan Kolar, founder at Atlas CPA Index.
Coffee
A coffee or other drink here and there doesn’t amount to much, but if it’s a daily routine, it could cost you.
In an interview with Reuters, 28-year-old Sephora Grey, attorney, said that she spends about $150 per month on daily pleasures, including coffee and chai.
This is another “necessity” that Kolar is also guilty of purchasing daily.
“Having your morning coffee on your way to work feels like a part of your routine, a great social activity for some, and an overall positive start to your day,” Kolar explained. “Unfortunately, that habit costs you $5 to $10 a day, and at a conservative twice a week, that could run you nearly $1,000 annually.”
Ride-Share Apps
Ride-share apps like Uber or Lyft can come in handy if you don’t have a car. For instance, Grey pays $400 per month on ride-share apps, Reuters reported. Relying on these services has helped her save money compared to owning a car and paying for insurance and a car loan. But if you do it out of convenience, then it’s more of a luxury rather than a necessity.
“Many of us justify calling an Uber because we are running late, we're tired, it's raining, etc.,” Kolar said. “The convenience of these services is great, but their high prices and ease of access have led to an overuse in unnecessary situations.”
Meal Delivery and Dining Out
Dining out and meal delivery services like DoorDash and Uber Eats can add hundreds of dollars or more to your monthly spending. According to a Reddit post, a married mom of two young kids explained that she cooks dinner at least four nights per week, but they also spend about $1,500 per month on DoorDash.
“Gen Z has been taught that 'time is money,' so they pay a 30% markup on a sandwich to save 20 minutes,” said Terence A. Townsend, principal at Wealth Heritage Group and staff writer for Men In Motion Magazine. “But if you aren't using those saved 20 minutes to build an empire or acquire a new skill, you didn't save time, you just leaked fuel.”
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This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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