A third (34%) of Gen Z shoppers would choose to save or invest an unexpected £1,000 windfall rather than spend it, new research has found.

A survey of 1,500 Gen Z consumers by accounting firm RSM UK and Retail Economics found that experiences outranked possessions when spending, with around 14% of the windfall going towards a major trip or event, compared with 12% for luxury goods. 

Dividing the generation into four groups, 43% were described as “future flexors,” “focused on building financial security”.

Forming a “balanced middle ground,” 24% were termed “experiential explorers,” who prioritised experiences and social occasions.

Additionally, 17% were “trendsetters,” comprising the most affluent Gen Z cohort who were “highly image-conscious and socially connected” and influenced “what wider Gen Z aspires to buy”.  

However, 16% were “budget loyalists,” forming the “youngest and most financially constrained” group, who were “practical and value-driven” and “focused on stretching every pound”.

Gen Z is set to drive over £26bn of retail spending in 2025, according to Retail Economics, with the figure rising to almost £40bn over the next decade.

RSM UK head of retail Jacqui Baker said: “Gen Z are often socially savvy, resilient and disciplined shoppers who take a pragmatic approach to spending. 

“However, this age group isn’t sheltered from current cost pressures, so saving for the future ultimately comes first. 

“This chimes with the bigger picture, with the household saving ratio increasing to 10.7% in Q2 2025, showing consumers are taking a more cautious approach across the board.”

This spending powerhouse is set to drive over £26bn of retail spending in 2025, rising to almost £40bn over the next decade, according to Retail Economics, highlighting the growing influence and spending power of this trendsetting group.

Retail Economics CEO Richard Lim added: “Gen Z are diverse, and their behaviours, expectations and purchasing decisions vary widely, so taking a “one size fits all” approach will fail. 

“Gen Z already represent a significant share of retail spending, and their influence is only set to grow as incomes rise, so recognising the differences within this generation is key to staying relevant in the future.”

In September, it was reported that book retailer Waterstones was riding a Gen Z reading boom, as it planned to open 10 new stores a year.

However, earlier this year, research from the Retail Technology Show found that millennials had overtaken Gen Z as the fastest growing demographic for social commerce purchases.

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