Latest news with #KylaScanlon
Bloomberg
a day ago
- Business
- Bloomberg
Why Many Gen Z Investors Are Coming Up Short
Kyla Scanlon calls it 'financial nihilism.' The financial influencer has built a career dissecting complex economic topics for hundreds of thousands of online followers. She says a get-rich-quick attitude is pushing more young investors to trade quickly in and out of stocks, perhaps at the expense of building wealth for the long term. 'For this generation, they are very disillusioned. They're very mad, they're extremely anxious and they're extremely distrustful,' she says on this episode of the Bloomberg Originals series Bullish. As for the idea of saving for retirement or limiting credit card debt? Scanlon says many in the generation feel "none of this actually matters.'
Vox
3 days ago
- Business
- Vox
What the rise of 'buy now, pay later' services tells us about the economy
You've probably noticed it by now: You're shopping online for some makeup or a new pair of running shoes or a water table for your toddler, and when you go to check out, you have a new option — why not break up the cost into four payments, made over time? US consumers, especially Gen Z and millennial ones, have been embracing 'buy now, pay later' services like Klarna and Afterpay with gusto the last few years. It's not hard to see the attraction: Unlike a credit card, most BNPL plans don't carry interest, and they generally don't impact your credit score (though that is now changing). On social media people tout BNPL as a way to buy stuff you want but don't have the cash for right then — or maybe ever. And that's starting to show up in the data: Leading BNPL company Klarna — which recently partnered with the food delivery service DoorDash, spawning a thousand memes — saw its net losses from consumers not paying their loans more than double in the first quarter of this year. All this has Kyla Scanlon worried. Scanlon is an author and economic commentator, best known for breaking down economic issues through blog posts and videos on social media. In a video she published shortly after Klarna announced its partnership with DoorDash, Scanlon called the rise of BNPL a symptom of our 'poor-impulse-control economy.' 'What I worry about is that the convenience and the impulsivity that it allows for allows for the expansion of the grift economy, of a world where people are spending money on things that they don't need to and they're just totally lost in that cycle,' Scanlon told Today, Explained co-host Noel King. Scanlon talked to King about buy now, pay later, Gen Z's relationship to debt, and what financial responsibility looks like in today's economy. Below is an excerpt of the conversation, edited for length and clarity. There's much more in the full podcast, so listen to Today, Explained wherever you get podcasts, including Apple Podcasts, Pandora, and Spotify. You're a commentator, you're a public intellectual, you're also a member of Gen Z, and you speak directly to Gen Zers who are operating in the economy. How are young people using BNPL? A lot of Gen Zers have had very common interactions with debt. Student loan debt is a big part of the life of a Gen Zer. Medical bills, anything involving a credit score. Debt has been so normalized for the younger generation that when they see something like BNPL, it's like, 'Oh, this is just casual debt.' For young people, they've been raised in the shadow of the 2008 crisis and student loan debt. It's just what they do with their money. This is interesting, that debt has always been available to Gen Z. If you're an older millennial like I am, that's not really the case. You might remember getting your first credit card when you were 22, but there was no Apple Pay. You couldn't just pay for stuff on your phone. And it strikes me that my nieces and nephews who are teenagers, they can do that. They have this ease with paying for stuff and taking on debt for stuff that never occurred to me when I was young. A lot of that is structural. In 2020, the government sent out unemployment checks. In 2021, the Fed had rates really close to zero. We're always talking about the deficit. We're always talking about how much money the United States as a country owes. And so I think for everybody, they're looking at that and they're like, If the government owes all this money, surely I can have a little bit of debt, too. And then credit scores have become such a core part of the American identity. It really informs a lot — how you can buy a house or if you can even get certain loans. I think people view debt as structural to themselves as a person, and that's increased. And I think it really has a lot to do with the environment that Gen Z has grown up in and the fact that these tools are so readily available and they're so easy to use. Talk to me a bit about debt. Is it dangerous? When you look at debt systemically, it's not inherently a bad thing. Like most things, it's a tool. Like social media, you could say it's bad, but it's just a tool. It's all about how you use it. Same with debt. BNPL in itself isn't evil, especially if you can pay it all off without having to face those high interest rates. Credit cards themselves aren't evil. But it's really about the system that encourages these sorts of products to be created. Real wages were stagnant for a really long time. The entry-level labor force has really deteriorated. It's very tough to get a job right now. If you're graduating from college and the college wage premium has eroded quite a bit, rent is high because we don't build enough housing. Groceries are up. People are looking at the very high prices, the impossibility of ever buying a house, the struggles that they might be facing in the labor force. It's like, Well, sure, it might be irresponsible to use BNPL to get a moisturizer from Sephora, but what else am I going to do? I don't see a solution before me. And so I think that's been the big thing with debt — we've used it as a tool in order to navigate some of the hairier parts about being in the United States right now. I think historically you might say, Look, you can't afford the Sephora lotion right now, why don't you just wait? And it sounds like what you were saying is that's a bit of a privileged or maybe old-fashioned idea of how paying for things works. Right! I think, 'Why don't you just wait?' ignores some of the ladder issues that we're facing as Gen Z, younger people — even millennials, in some capacity, are facing this broken-ladder problem where they could wait to buy that moisturizer, but that would require the entry-level labor market to free up again, that would require wages to really speed up, that would require the housing market to normalize. So I think a lot of people blame younger people for using debt and using BNPL. And you should be careful — I don't think you should be living above your means in an extravagant way. But it really is a psychological buffer of sorts, where people are just like, Well, I don't know what else to do, so I'm going to go buy this thing. It is an element of instant gratification, the same thing that we see in social media, but for Gen Z-ers and younger people. There isn't that stability, that expectation of stability in the traditional sense. And so I think these little small luxuries matter — buying that moisturizer matters because it is indulgent in a certain way, but it's also an act of agency in an economy that doesn't feel like it's allowing you into it. It does feel like there is some American ethos here that says, To live is to be in debt, and we've all accepted that. I mean, that's the only way you can get by sometimes. There's that misquoted statistic about living paycheck to paycheck. It's not 60 percent of Americans living paycheck to paycheck. It's far lower, but I think a lot of people just feel like, one wrong move and the whole thing could come tumbling down.
Yahoo
22-06-2025
- Business
- Yahoo
Bad ‘vibes' may be having a bigger impact on the economy now
There has been a disconnect in recent years between the so-called soft economic data and the hard data as weak readings on consumer confidence didn't always translate to lower payrolls or GDP. But that may be changing as key buffers that propped up spending are disappearing, according to NerdWallet senior economist Elizabeth Renter. Americans used to say one thing about their feelings on the economy and do something else with their actual dollars. But that may be changing. The disconnect between weak readings on consumer confidence versus solid employment, income and GDP data was previously described as a 'vibecession' by economist Kyla Scanlon, who first used the term in her 2022 Substack post. The last vibecession hit as inflation was at the highest levels in more than 40 years, while an aggressive rate-hiking campaign from the Federal Reserve spiked borrowing costs, making auto loans and mortgages more expensive. But consumers continued to spend as the labor market remained robust. And aside from a brief dip in GDP, the economy avoided a recession. Confidence surveys also increasingly reflected partisan differences more than the actual economy. Fast forward to 2025. Consumer sentiment collapsed after President Donald Trump launched his trade war, and GDP shrank again, skewed by a rush to buy imported goods ahead of higher tariffs. Still, payrolls have held up, and inflation hasn't been as affected by tariffs as feared. But while sentiment recovered a bit after Trump postponed his highest tariff rates, it's still 20% below December 2024 levels. 'Despite this month's notable improvement, consumers remain guarded and concerned about the trajectory of the economy,' the most recent University of Michigan survey said. At the same time, the Trump administration is slashing spending and jobs, with ripple effects reaching contractors and even certain real estate markets. Businesses that are uncertain about the economy and the direction of tariffs have slowed hiring. Student-loan delinquencies are up, and AI is eliminating many entry-level jobs that once went to newly minted college graduates. Then there's oil prices, which have jumped since Israel launched airstrikes on Iran. The cumulative effect is taking a toll. 'I don't think the U.S. consumer has grown numb or blind to the headlines and economic risk—over the past month we've seen some sentiment scores rise slightly, but we have to think about where they were rising from,' Elizabeth Renter, senior economist at NerdWallet, said in a note on Friday. 'A little bit better doesn't necessarily mean good, even if it might mean hopeful.' As a result, it's getting harder to dismiss the so-called soft data on the economy and focus instead on the hard data. That's as Fed Chairman Jerome Powell has said he and his fellow policymakers won't act on rates until the hard data on unemployment and inflation gives them a clear reason to. But the soft stuff may be leaking into the hard stuff. 'Unlike a few years ago, the 'vibes' now stand to have a greater impact on behavior, and thus the health of the economy,' Renter wrote. 'That's because unlike a few years ago, people don't have the luxury of easily stumbling into a better job or relying on excess savings and debt payment forbearances.' In fact, household debt is rebounding to pre-pandemic levels and beyond, eroding the ability to absorb an unexpected expense or job loss, she added. Bill Adams, chief economist at Comerica Bank, similarly drew a direct line between consumer sentiment and actual spending. Digging into the May retail sales report, he noted that consumers didn't just pull back on durable goods like electronics and cars, which fell after an earlier jump to get ahead of tariffs, they also reined in spending on daily expenses like groceries and restaurants. Spending at building material and garden supply stores also saw big drops, suggesting less residential investment in home improvements. 'With declines visible in unrelated categories, it looks like weak consumer confidence was to blame for the pullback in consumer spending last month,' Adams wrote. This story was originally featured on Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
21-06-2025
- Business
- Yahoo
Bad ‘vibes' may be having a bigger impact on the economy now
There has been a disconnect in recent years between the so-called soft economic data and the hard data as weak readings on consumer confidence didn't always translate to lower payrolls or GDP. But that may be changing as key buffers that propped up spending are disappearing, according to NerdWallet senior economist Elizabeth Renter. Americans used to say one thing about their feelings on the economy and do something else with their actual dollars. But that may be changing. The disconnect between weak readings on consumer confidence versus solid employment, income and GDP data was previously described as a 'vibecession' by economist Kyla Scanlon, who first used the term in her 2022 Substack post. The last vibecession hit as inflation was at the highest levels in more than 40 years, while an aggressive rate-hiking campaign from the Federal Reserve spiked borrowing costs, making auto loans and mortgages more expensive. But consumers continued to spend as the labor market remained robust. And aside from a brief dip in GDP, the economy avoided a recession. Confidence surveys also increasingly reflected partisan differences more than the actual economy. Fast forward to 2025. Consumer sentiment collapsed after President Donald Trump launched his trade war, and GDP shrank again, skewed by a rush to buy imported goods ahead of higher tariffs. Still, payrolls have held up, and inflation hasn't been as affected by tariffs as feared. But while sentiment recovered a bit after Trump postponed his highest tariff rates, it's still 20% below December 2024 levels. 'Despite this month's notable improvement, consumers remain guarded and concerned about the trajectory of the economy,' the most recent University of Michigan survey said. At the same time, the Trump administration is slashing spending and jobs, with ripple effects reaching contractors and even certain real estate markets. Businesses that are uncertain about the economy and the direction of tariffs have slowed hiring. Student-loan delinquencies are up, and AI is eliminating many entry-level jobs that once went to newly minted college graduates. Then there's oil prices, which have jumped since Israel launched airstrikes on Iran. The cumulative effect is taking a toll. 'I don't think the U.S. consumer has grown numb or blind to the headlines and economic risk—over the past month we've seen some sentiment scores rise slightly, but we have to think about where they were rising from,' Elizabeth Renter, senior economist at NerdWallet, said in a note on Friday. 'A little bit better doesn't necessarily mean good, even if it might mean hopeful.' As a result, it's getting harder to dismiss the so-called soft data on the economy and focus instead on the hard data. That's as Fed Chairman Jerome Powell has said he and his fellow policymakers won't act on rates until the hard data on unemployment and inflation gives them a clear reason to. But the soft stuff may be leaking into the hard stuff. 'Unlike a few years ago, the 'vibes' now stand to have a greater impact on behavior, and thus the health of the economy,' Renter wrote. 'That's because unlike a few years ago, people don't have the luxury of easily stumbling into a better job or relying on excess savings and debt payment forbearances.' In fact, household debt is rebounding to pre-pandemic levels and beyond, eroding the ability to absorb an unexpected expense or job loss, she added. Bill Adams, chief economist at Comerica Bank, similarly drew a direct line between consumer sentiment and actual spending. Digging into the May retail sales report, he noted that consumers didn't just pull back on durable goods like electronics and cars, which fell after an earlier jump to get ahead of tariffs, they also reined in spending on daily expenses like groceries and restaurants. Spending at building material and garden supply stores also saw big drops, suggesting less residential investment in home improvements. 'With declines visible in unrelated categories, it looks like weak consumer confidence was to blame for the pullback in consumer spending last month,' Adams wrote. This story was originally featured on
Yahoo
13-06-2025
- Business
- Yahoo
How Advisors Can Harness Media to Reach Gen Z
Meeting digital natives where they're at isn't always easy. But with more than a third of Gen Z investors citing influencers as a 'major factor' in their decision to buy, experts say that advisors — an aging demographic, by all accounts — need to be attuned to younger generations' habits. Nearly half of Gen Z uses social media as a primary source of investing information, compared with 42% of Millennials and 26% of Gen X, according to recent research from Finra and the CFA Institute. '[Social media is] where younger people are,' said Kyla Scanlon, an influencer and founder of the financial education company Bread. 'That can be difficult for a lot of [older advisors], where they're like, 'Oh, I prefer to do everything the old-fashioned way,' and that doesn't work with younger people … They get all their information on social media.' READ ALSO: Financial Uncertainty Spurs Anxiety and Depression and Most Americans Question Online Financial Information Rising costs of living and stagnant wages have contributed to feelings of financial nihilism — someone's sense that they'll never be financially stable, or homeowners, or retirement-ready — in every generation, but particularly Gen Z: Less than one in three Gen Zers is currently saving for retirement, a Bankrate survey showed, with 30% of this demographic 'feeling behind' on retirement savings. This generation is also twice as likely as the general population to say they don't know where to find an advisor, despite being, on average, 13 percentage points more likely to want one. There are several ways advisors can harness the power of the internet to expand their reach. Taking a 'personal approach' is key in an age of branding, since Gen Z is wary of ulterior motives in advertising and online financial advice, Scanlon said. 'The way that [advisors] should approach it is that character-based approach,' she said. 'It's not like, 'I will have Blackrock ETFs and VanEck ETFs.' It's, 'I am a person who's going to help you through this.'' Utilizing client testimonials can also be a powerful tool in the review-centric era of sites like Yelp. The company Wealthtender makes use of the SEC's lifting of the testimonial rule, which CEO Brian Thorp thinks advisors still aren't taking advantage of. Even though testimonials have been allowed since 2021, only 9.3% of SEC-registered firms are using them, he said. Into the Pod-verse. Podcasts can also be a key way for advisors to build out their Gen Z books, gain an online following, and establish credibility. Six out of 10 Gen Zers say that it's 'important that podcasts provide them with good tips and advice,' according to data from SiriusXM. Mitlin Financial founder Larry Sprung said his firm's podcast — whose guests are asked what brought them joy that day — has helped the firm establish its core message and set itself apart. 'We started leaning into it. We created shirts… We feel like, especially in the world today, there's so much divisiveness,' he said. 'Joy is somewhat universal. It has resonated with a lot of people.' This post first appeared on The Daily Upside. To receive financial advisor news, market insights, and practice management essentials, subscribe to our free Advisor Upside newsletter. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
