People say how “kids these days” don’t understand hard work and are terrible with money. Younger generations are easy targets for their older counterparts. But if a recent study is accurate, the upcoming Generation Z might prove their older critics wrong.
According to a study released by the Center for Generational Kinetics, members of Gen Z are already working, planning for college — and even saving for retirement. One of the biggest differences between Gen Z and Millennials is their approach to college planning and student loan debt.
“We see the pendulum swinging back from the Millennials ‘college debt is part of life’ mentality,” said the white paper from the Center for Generational Kinetics. Instead, more than one in five members of Gen Z want to avoid personal debt at all costs.
Members of Gen Z are making decisions based on the cost of college. They also plan to work and use entrepreneurship to save money.
Gen Z is ready to pay their way through college
According to the study, about 38 percent of participants plan to work while in college. On top of that, 24 percent of those surveyed expect to use personal savings to help pay for college.
Gen Z is also considering the cost of college when making their decisions. “The mindset used to be that you would go to the best college you could get into and then get loans in order to pay for it,” said Jason Dorsey, the president of the Center for Generational Kinetics, according to Business Insider.
Considering community college to save money
Eva Baker, the founder of TeensGotCents and the Teenpreneur Conference, is 21 years old and one of the older members of Gen Z. Instead of choosing to go to a four-year school, she decided to take classes at the local community college.
“It’s so much more affordable,” Baker said. “Go to the local community college and stay at home. It makes a big difference.”
She pointed out that, in the past, a community college might not offer the same level of education as a four-year school. However, she feels like that’s not true anymore. Educational offerings from community colleges have improved. Now a community college offers a great value for the money, said Baker.
Choosing a low-cost school that will get the job done is part of the equation when it comes to getting through school with little to no debt. The other piece, as the Center for Generational Kinetics pointed out, is personal savings and a willingness to work through college.
And Gen Z is on top of that, too.
Gen Z is already earning money
The study found that 77 percent of those aged 14 to 21 are already earning their own money. They do so through freelance work, part-time jobs, or an earned allowance.
The Center’s study said that the percentage of Gen Z members already earning and spending their own money is on par with Millennials — who are 10 years older.
Today’s teens are more entrepreneurial than previous generations, too, an article in the Harvard Business Review pointed out.
The article’s author, Whitney Johnson, pointed out that her own peers cited teen jobs like flipping burgers and waiting tables.
“When I asked what their children do to earn money, only 12 percent of them had jobs that I would describe as traditional teen jobs,” Johnson wrote. “A whopping 70 percent had jobs that are best described as self-employed.”
From running babysitting businesses to selling on eBay, to teaching music lessons, teenagers earn money on their terms. And that can help them when they go to college or look for work later.
Learning and growing
Baker started her business at age 16. Now she connects teenpreneurs through her website, workshops, and the Teenpreneur Conference, which is in its second year.
“Being a teen entrepreneur is so beneficial,” Baker said. “It doesn’t really matter if it’s what you do for the rest of your life or if you just do it during high school. You learn so much.”
Baker learned basic accounting skills, communication skills, and how to brand herself. She also learned valuable customer service skills that will help her for the rest of her life, no matter what she ends up doing to earn money.
Running a successful business has allowed Baker to attend her community college part-time, off-and-on, over the last few years — without the need to go into debt. In fact, she actually put off college attendance to work on her business. She only has about three semesters of higher education under her belt. Baker’s at an age when many young adults are getting ready to graduate from a four-year program.
“I was about to enroll in a full-time program, and realized that my business opportunities were now,” Baker said. “If this is ever not what I want to do or stops being successful, school’s still going to be there.”
This practical attitude is one that seems to define Gen Z as its members grow, work, and plan for higher education. Of course, we will have to wait a few years to see if members of Gen Z actually realize their dreams — but it looks as though they’re off to a good start.
Interested in refinancing student loans?Here are the top 6 lenders of 2018!
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1 Important Disclosures for Earnest.
To qualify, you must be a U.S. citizen or possess a 10-year (non-conditional) Permanent Resident Card, reside in a state Earnest lends in, and satisfy our minimum eligibility criteria. You may find more information on loan eligibility here: https://www.earnest.com/eligibility. Not all applicants will be approved for a loan, and not all applicants will qualify for the lowest rate. Approval and interest rate depend on the review of a complete application.
Earnest fixed rate loan rates range from 3.89% APR (with Auto Pay) to 7.89% APR (with Auto Pay). Variable rate loan rates range from 2.47% APR (with Auto Pay) to 6.97% APR (with Auto Pay). For variable rate loans, although the interest rate will vary after you are approved, the interest rate will never exceed 8.95% for loan terms 10 years or less. For loan terms of 10 years to 15 years, the interest rate will never exceed 9.95%. For loan terms over 15 years, the interest rate will never exceed 11.95% (the maximum rates for these loans). Earnest variable interest rate loans are based on a publicly available index, the one month London Interbank Offered Rate (LIBOR). Your rate will be calculated each month by adding a margin between 1.82% and 5.50% to the one month LIBOR. The rate will not increase more than once per month. Earnest rate ranges are current as of Month/Day/Year, and are subject to change based on market conditions and borrower eligibility.
Auto Pay discount: If you make monthly principal and interest payments by an automatic, monthly deduction from a savings or checking account, your rate will be reduced by one quarter of one percent (0.25%) for so long as you continue to make automatic, electronic monthly payments. This benefit is suspended during periods of deferment and forbearance.
The information provided on this page is updated as of 08/21/18. Earnest reserves the right to change, pause, or terminate product offerings at any time without notice. Earnest loans are originated by Earnest Operations LLC. California Finance Lender License 6054788. NMLS # 1204917. Earnest Operations LLC is located at 302 2nd Street, Suite 401N, San Francisco, CA 94107. Terms and Conditions apply. Visit https://www.earnest.com/terms-of-service, email us at email@example.com, or call 888-601-2801 for more information on ourstudent loan refinance product.
© 2018 Earnest LLC. All rights reserved. Earnest LLC and its subsidiaries, including Earnest Operations LLC, are not sponsored by or agencies of the United States of America.
2 Important Disclosures for Laurel Road.
Laurel Road Disclosures
APR stands for “Annual Percentage Rate.” Rates listed include a 0.25% EFT discount, for automatic payments made from a checking or savings account. Interest rates as of 11/8/2018. Rates subject to change.
Variable rate options consist of a range from 3.27% per year to 6.09% per year for a 5-year term, 4.64% per year to 6.14% per year for a 7-year term, 4.69% per year to 6.19% per year for a 10-year term, 4.94% per year to 6.44% per year for a 15-year term, or 5.19% per year to 6.69% per year for a 20-year term, with no origination fees. APR is subject to increase after consummation. The variable interest rate will change on the first day of every month (“Change Date”) if the Current Index changes. The variable interest rates are based on a Current Index, which is the 1-month London Interbank Offered Rate (LIBOR) (currency in US dollars), as published on The Wall Street Journal’s website. The variable interest rates and Annual Percentage Rate (APR) will increase or decrease when the 1-month LIBOR index changes. The variable interest rates are calculated by adding a margin ranging from 0.98% to 3.80% for the 5-year term loan, 2.35% to 3.85% for the 7-year term loan, 2.40% to 3.90% for the 10-year term loan, 2.65% to 4.15% for the 15-year term loan, and 2.90% to 4.40% for the 20-year term loan, respectively, to the 1-month LIBOR index published on the 25th day of each month immediately preceding each “Change Date,” as defined above, rounded to two decimal places, with no origination fees. If the 25th day of the month is not a business day or is a US federal holiday, the reference date will be the most recent date preceding the 25th day of the month that is a business day. The monthly payment for a sample $10,000 loan at a range of 3.27% per year to 6.09% per year for a 5-year term would be from $180.89 to $193.75. The monthly payment for a sample $10,000 loan at a range of 4.64% per year to 6.14% per year for a 7-year term would be from $139.65 to $146.76. The monthly payment for a sample $10,000 loan at a range of 4.69% per year to 6.19% per year for a 10-year term would be from $104.56 to $111.98. The monthly payment for a sample $10,000 loan at a range of 4.94% per year to 6.44% per year for a 15-year term would be from $78.77 to $86.78. The monthly payment for a sample $10,000 loan at a range of 5.19% per year to 6.69% per year for a 20-year term would be from $67.05 to $75.68.
However, if the borrower chooses to make monthly payments automatically by electronic funds transfer (EFT) from a bank account, the variable rate will decrease by 0.25%, and will increase back up to the regular variable interest rate described in the preceding paragraph if the borrower stops making (or we stop accepting) monthly payments automatically by EFT from the designated borrower’s bank account.
3 Important Disclosures for SoFi.
4 Important Disclosures for LendKey.
Refinancing via LendKey.com is only available for applicants with qualified private education loans from an eligible institution. Loans that were used for exam preparation classes, including, but not limited to, loans for LSAT, MCAT, GMAT, and GRE preparation, are not eligible for refinancing with a lender via LendKey.com. If you currently have any of these exam preparation loans, you should not include them in an application to refinance your student loans on this website. Applicants must be either U.S. citizens or Permanent Residents in an eligible state to qualify for a loan. Certain membership requirements (including the opening of a share account and any applicable association fees in connection with membership) may apply in the event that an applicant wishes to accept a loan offer from a credit union lender. Lenders participating on LendKey.com reserve the right to modify or discontinue the products, terms, and benefits offered on this website at any time without notice. LendKey Technologies, Inc. is not affiliated with, nor does it endorse, any educational institution.
5 Important Disclosures for CommonBond.
Offered terms are subject to change. Loans are offered by CommonBond Lending, LLC (NMLS # 1175900). If you are approved for a loan, the interest rate offered will depend on your credit profile, your application, the loan term selected and will be within the ranges of rates shown.
All Annual Percentage Rates (APRs) displayed assume borrowers enroll in auto pay and account for the 0.25% reduction in interest rate. All variable rates are based on a 1-month LIBOR assumption of 2.28% effective October 10, 2018.
6 Important Disclosures for Citizens Bank.
Citizens Bank Disclosures
|2.47% – 6.99%3||Undergrad & Graduate|
|2.46% – 6.97%1||Undergrad & Graduate|
|2.57% – 8.44%4||Undergrad & Graduate|
|3.05% – 6.47%2||Undergrad & Graduate|
|2.50% – 7.24%5||Undergrad & Graduate|
|2.79% – 8.39%6||Undergrad & Graduate|