To Gen Z, nothing in life is free, unless you pay cash.

Recently, as I was scrolling TikTok as one does in an effort to numb their brain, I came across a trending video that struck a chord. Essentially, it was young people, probably in their late teens or early twenties, making videos in which they place cash down on a table, with the caption stating, “Me paying with physical cash instead of my card, which means the number in my account didn’t go down, so it’s free.” Two of these videos amassed over 4 million views each, proving that fellow TikTokers resonated with the statement. After seeing the traction these videos got, I wanted to dive a bit deeper into why the younger generation feels this way.

We’ve all been there; we’ve gotten cash for a side gig, gifted cash for our birthday or the holidays or our friends have spotted us an outdated green piece of paper for something we bought them. Then we go ahead and spend this cash as if it is free money.

First off, I relate to this on a spiritual level. When I have cash on me, I am much more willing to spend and tip generously. Who is going to wait for change when you give a $5 bill as a tip for a $10 drink? I’m definitely not waiting for change when I over-tip by a few bucks. That whole process is dated and again, I paid cash, so in my mind, it was free to begin with. I say this half-jokingly as I never mind leaving the service industry a hefty tip.

In my case, spending cash to make something feel “free” is based on the fact that it does not get tracked in any of my apps. My brain is fully convinced that since my bank account, credit card and NerdWallet net worth tracker had no trace of this money, it simply ~did not exist~. In my mind, my finances exist solely through apps. I have felt this way for a long time, and it is apparent that my peer group feels similarly.

I am a financial professional, of course, I am fully aware that spending cash is in fact affecting my finances, but it is funny to see how technology is impacting the psychological aspects of our finances. It is something that we need to be aware of as a group. We have convinced ourselves that spending cold hard cash has nothing to do with our finances. I am not sure any further evidence is needed when I say we should probably be mindful of the impact this technology is having on us.

Our generation is incredibly tech-forward; it has become a major aspect of our lives in every capacity. From our professional lives to our personal lives, technology is embedded throughout. Some may argue this is for the worst, especially those who did not grow up with little supercomputers within arm’s reach at any given moment of any given day. I mean, come on, we have a generation that is now convinced that spending a dollar bill is in fact not spending at all. But I would make the argument that this is solid proof that young people are paying attention to mostly the right things financially. For one, this idea of cash making things feel free is based on the fact that people are in tune with their credit card and bank statements. Likely because each of these statements are so readily available, we have no excuse not to keep an eye on them. 

I would also go on to argue that this is in direct contrast to the age-old assumption that credit cards lead to people spending more. That whole argument was based on the idea that spending on a credit card didn’t entail physically forking over your sweet greenbacks. Gen Z has turned that argument on its head, essentially feeling the exact opposite. 

In all seriousness, this tech-enabled environment has led us to have all of our financial information at the tips of our fingers. It has never been easier to track your expenses, view your savings, transfer money from bank to brokerage, and even from bank to crypto exchange. Although our generation may feel as though spending cash makes things free, I believe the technology behind it is a net positive for Gen Z. Hopefully, as time goes on, we continue to grow access to technology that makes saving and investing more accessible. Maybe rappers will begin flexing their Ledger Nano S instead of wads of cash in the near future. And yes, I will die on this hill: spending cash makes whatever goods or services I purchase feel like they’re free.

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