In 2025, it’s no secret that times are tough for everyone across the board. According to the Equifax Market Pulse Index (MPI), the average US consumer is in a worse place in 2025 than they were 4 years ago in 2021. This has seemed to hit younger generations the hardest, as they have a much thinner cushion to fall back on. In fact, Generation Z and Millennials have an estimated 28% of the total US dollars in savings, with Gen Z accounting for only 5%. Furthermore, their combined investable assets accounts for only 17% of the total US investable assets. So how are younger consumers coping during this holiday season?
One of the major ways is with Buy Now, Pay Later (BNPL) services. These have exploded in popularity across various online storefronts, especially amongst the younger generations. Simply put, it works similar to a traditional loan. The service provider will pay off an item that you wish to purchase, and you will instead pay the service provider in easy installments for the item. This flexibility is incredibly important to consumers who are in between paychecks, or making a large number of purchases like during the holidays. In fact, it is estimated that 67% of parents intend to use BNPL on everything from furniture to clothing and accessories. In another survey, 43% of consumers said that BNPL was so accessible, it will influence where they end up buying gifts from.
Another strategy that younger generations have adopted is by preplanning holiday gift spending. Last year, around 45% of all planned holiday shopping was transacted between the 5-day window between Thanksgiving and Cyber Monday due to the massive discounts offered. This year, this trend stays the same at around 39%. When zooming out, some consumers finish shopping even earlier as it’s estimated that 80% of all planned holiday shopping is done by the end of Cyber Monday.
The last important factor to consider for enticing Generation Z spending is what the goods themselves are. For example, 43% of consumers say that family gifts are a ‘non-negotiable item’ during the holidays and 35% say the same for children’s gifts. Similarly, 28% say that gifts that are for holiday traditions or experiences fall into this same non-negotiable category. Ultimately, whether your business wants to target younger or older consumers during the holidays, the best approach is to be smart about it. Making sure to prioritize what’s important to consumers is key during this holiday season.
Source: Equifax
