8 Money Traps Millennials Fell For That Gen Z Avoids

When it comes to money, every generation learns a few lessons the hard way.

Millennials came of age during recessions, a student loan crisis and the peak of avocado toast culture –racking up financial missteps along the way.

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According to Chris Heerlein, CEO of REAP Financial, millennials face significant challenges due to student loan debt, rising living costs and stagnant wages. Many entered the workforce during the Great Recession, leading to high debt burdens while trying to save for retirement and major life goals.

He explained that these financial pressures are compounded by the increasing cost of healthcare and the difficulty of securing affordable housing, making long-term financial stability harder to achieve.

But Gen Z? They’re approaching money with a whole different mindset. From credit card chaos to housing headaches, here are the money traps millennials fell into that Gen Z is (so far) smartly sidestepping.

According to the Education Data Initiative, millennials have the largest share of total student loan debt despite a declining average balance.

Andrew Lokenauth, money expert and owner of BeFluentInFinance, has watched countless millennial clients struggle under crushing student loans — we’re talking over $50,000 for degrees that didn’t deliver the promised returns.

He said his millennial clients often tell him they felt pressured to attend expensive schools because “that’s just what you did.

“But Gen Z. Man, they’re different. I’m seeing them choose community college first, then transfer to state schools.”

Or they’re pursuing trade schools and certifications — smart moves that’ll save them thousands.

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According to Lokenauth, back in the day, millennials bought into this toxic “hustle culture” mindset –burning themselves out working three to four gigs just to stay afloat.

“I still remember one client who was juggling a full-time marketing job, driving Uber at night and selling stuff on eBay,” he recounted. “She was exhausted.”

Gen Z, on the other hand, seems more focused on building actual sustainable businesses or investing in skills that’ll boost their main career trajectory. They’re playing the long game.

“Here’s something that makes me angry: Millennials got absolutely destroyed by housing market timing,” said Lokenauth.

Many graduated into the 2008 recession, couldn’t buy when prices were low, then got priced out when the market recovered.