Millennials and Gen Z transform finances with #LoudBudgeting

Cape Town - The #LoudBudgeting TikTok trend seems to be shattering money talk taboos, and it’s a win for financial literacy. With Gen Z at the helm and amassing nearly 10 million views, this trend sparks discussions about financial wins, setbacks, goals, and savings tactics. Farzana Botha, Head of Communications at Sanlam Risk and Savings, says this vital lesson in financial literacy presents a golden opportunity to explore diverse generational money mindsets to harness each generation’s best practices.

“We’ve seen a significant shift in financial behaviour across generations.  Baby Boomers were a largely silent generation that valued privacy around money matters, especially debt. Gen X moved towards more openness about financial struggles, while Millennials leveraged technology to automate tracking and savings. Meanwhile, Gen Z is reshaping financial literacy using social media and shared content creation to drive open and honest money talk.”

Here, Botha unpacks this trend, and the lessons we can learn from previous generations.

What is #LoudBudgeting?

#LoudBudgeting is a social media trend where people verbalise their budgeting strategies and savings goals. It encourages open discussions about savvy savings practices, for example, ditching a daily coffee to save money for petrol instead.

Botha says, “This trend contrasts with the financial habits of older generations, who often kept their financial matters private. As a result, individuals of all ages learn from each other's experiences and mistakes. This can be powerful.”

Here’s how previous generations’ money behaviours and mindsets compare to the most recent money talk trend.

Baby Boomers – the silent generation

Botha says Baby Boomers generally have a conservative and traditional financial mindset rooted in their formative years. This generation kept its financial matters private, especially concerning debt – making money a taboo topic of discussion. "Living through times of scarcity has pushed them to prioritise building long-term assets, eliminating debt, and saving for retirement. They meticulously track every rand earned and spent and avoid unnecessary expenses.”

Botha highlights how this generation’s future-focused financial decisions are often at the expense of present enjoyment. For example, they may prioritise homeownership and retirement funds over travel and entertainment.

Something to let go of: Consider being financially transparent rather than hiding your financial standing from loved ones out of shame or embarrassment. These open conversations can help people get support earlier when challenges arise.
Something to learn: We can learn the importance of forward-thinking financial habits from this generation, placing needs over wants.

Learning to hustle like Gen Xers

Sandwiched between Baby Boomers and Millennials, Gen Xers have seen their workaholic parents struggle to balance life and money. They often prioritise investing in real estate, stocks, and retirement funds while budgeting for vacations. “Rather than climbing the corporate ladder, Gen Xers leverage side hustles, entrepreneurship, and specialised skills to diversify income streams and grow their wealth.”

Something to let go of: This desire for balance can lead to risk-averse financial decisions that curb potential returns.
Something to learn: The key lesson from Gen X is learning the power of diversification, alternative income sources, and calculated spending. Mixing Gen Xers’ traditional and innovative money tactics can pave the way for financial flexibility.

Millennials’ technology-driven money management

As digital natives, Botha says Millennials are innovative in leveraging technology for money management. “They enthusiastically adopt money apps and automation tools to track spending, saving, and investing. Digital platforms make budgeting a breeze by automatically allocating funds towards goals, and customised portfolios are just a click away through automated advisers.”

She says Millennials also explore side hustles, entrepreneurship, and the gig economy, from driving for Uber, renting out a property, or selling crafts online to supplement their income and turbocharge their savings.

Something to let go of: Yearning for convenience and passive income generation sometimes comes at the cost of understanding finances more deeply.
Something to learn: Over-reliance on apps means losing touch with where money flows. The lesson from Millennials is to use innovation to remove money management friction while continuing financial education. Combining tech with knowledge is powerful for taking control of personal finances.

Learning from Gen Z’s community approach to financial management

Botha says Gen Z leverages TikTok investing trends and YouTube tutorials to help each other learn collaboratively. This generation crowdsources advice and finds community support through vocalising shared struggles, such as #LoudBudgeting.

“Gen Z also explores diversified and alternative saving and investing strategies aligned to social causes. For example, they prioritise impact alongside returns through sustainable index funds. However, this desire to move quickly and make a change can sometimes increase risk exposure.”

Something to let go of: Although this generation demonstrates the impact of alternative approaches to financial management, be careful not to jump on opportunities without thoroughly understanding the risks.
Something to learn: This generation teaches us to educate ourselves through diverse sources, learn from each other’s experiences and practices, and to take some smart risks. Combining innovation with grounded education leads to sustainable wealth creation.

A lesson for all generations

Botha says while #LoudBudgeting’s growing popularity signals a shift in financial values, the crucial role of a financial adviser cannot be overstated. “Financial advisers are experts in their field and can provide invaluable insights and guidance on managing finances effectively, despite various macroeconomic conditions, societal norms, and personal experiences influencing different generations' money behaviour.

“Whether you're just starting your career, planning for retirement, or somewhere in between, a financial adviser can help you make the most of your financial situation and achieve your financial goals with confidence.”