Universitas Gadjah Mada
Faculty of Economics and Business

One of the biggest challenges facing Generation Z (Gen Z) is managing their finances wisely. This generation is growing amidst rapid technological advancements that offer convenient financial services such as pay-later schemes and online loans. So, how can Gen Z manage their finances effectively?

Banking, finance, and investment expert and FEB UGM Management Department lecturer I Wayan Nuka Lantara emphasized the importance of proper financial planning by setting both short-term and long-term goals. According to him, managing income and expenses are two crucial aspects.

"The ability to prepare for the future depends on one's ability to save or invest," he explained at FEB UGM on Thursday (16/01/2025).

Wayan explained that achieving positive savings for investment requires increasing income and minimizing expenses. In addition, discipline is essential to avoid excessive consumption by learning to prioritize needs.

"It is important to distinguish between needs and wants," he stressed.

Wayan highlighted that the current Fear of Missing Out (FOMO) phenomenon encourages Gen Z to be more consumptive. This behavior is often geared toward satisfying wants rather than actual needs.

"If done without proper awareness, this could lead them to rely on external sources such as pay-later schemes, online loans, or even online gambling," he warned.

He also stressed the importance of categorizing and allocating funds, for example, for transactions, investments, and emergency savings.

"Allocate how much for emergency funds, how much for investments, and the rest for consumption," he suggested.

Wayan noted that achieving financial independence does not happen overnight but requires a process. Consistent habits such as saving, managing income and expenses, and being disciplined in financial planning and spending become a strong foundation for future financial stability.

He emphasized that this process requires patience and consistency to save each month. The goal is not to become a millionaire or billionaire but to enjoy the process of financial management and learn about investing.

"After graduation, they are expected to have a stable income and improved investment skills. The focus isn't on how much they can save, but on learning to invest," he added.

Correctly understanding investing also plays a crucial role in achieving financial freedom. Wayan mentioned that there are many convenient investing platforms in today's online age. So, what does a safe investment look like?

He advised Gen Z to avoid chasing investment trends without considering their risk profile. He also shared some tips for safe investing.

"The first step in learning how to invest is through mutual funds. I recommend mutual funds for beginners because you can start investing with minimal capital. If you want to upgrade, you can learn about capital market instruments like stocks or bonds, even crypto," he added, noting that buying and selling gold is also a viable investment option.

Reportage: Shofi Hawa Anjani
Editor: Kurnia Ekaptiningrum

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