Many people have a skewed understanding of what Americans actually earn, often influenced by the glamorized portrayals of wealth in media and entertainment. While some have a realistic grasp of reasonable salary expectations, others—particularly among the younger generation—have developed what Gen-Z might call “delulu”—or delusional—ideas about financial success.
A recent survey by financial firm Empower highlights a significant disconnect between young people’s perceptions of financial success and economic reality. The study reveals that Gen-Z respondents, on average, believe an annual salary of $587,797 and a net worth of $9.47 million are necessary to achieve "financial success."
This perception becomes even more striking when compared to actual income distribution in the United States. Earning over half a million dollars annually would place an individual in the top 1% of earners in 32 out of 50 states, according to research from SmartAsset. This underscores just how unrealistic the average Gen-Z benchmark for success truly is.
This disconnect raises important questions about financial literacy and the potential consequences of setting such unattainable goals. As Gen-Z enters the workforce, reconciling these high expectations with economic realities may prove to be a significant challenge, potentially affecting career choices, job satisfaction, and overall financial well-being.
### Generational Differences in Financial Expectations
Empower’s latest “Secret to Success” survey found that Americans, on average, view an annual income of $270,214 as the threshold for financial achievement—a figure substantially exceeding the current median household income of $80,610.
The most notable finding is the pronounced disparity in salary expectations across age groups. Gen-Z demonstrates notably more ambitious financial benchmarks compared to Millennials, who set a comparatively modest target of approximately $180,000 as their marker of professional and economic success.
Gen-Z not only sets the highest standards for financial success but also exhibits the greatest confidence in achieving those goals. Seventy-one percent of Gen-Z respondents expressed optimism about attaining financial success during their lifetimes. This is slightly higher than the 70% of Millennials who feel the same way, while only 53% of Gen-X and 45% of Baby Boomers share this level of confidence.
### Defining Financial Success
Across generations, only 27% of people consider wealth to be the primary indicator of financial success. In contrast, a majority of Americans—59%—believe that happiness is the most significant measure, emphasizing the importance of spending on things and experiences that bring joy and engaging in activities they love. Additionally, 35% value the luxury of free time to pursue personal interests as a crucial aspect of financial success.
For some, financial success is characterized by practical, tangible achievements. A significant majority (63%) prioritize the ability to pay bills consistently, while 52% view homeownership as a key milestone. Nearly half (47%) consider the capacity to afford enjoyable experiences like travel and entertainment as indicators of financial well-being. Retirement planning is also key, with 40% focusing on reaching a specific retirement age, and 42% emphasizing the importance of finding job satisfaction during their working years.
Moreover, respondents describe success as being dependent on the "Factor of Four": hard work (84%), talent (65%), connections or "The Network Effect" (55%), and luck or circumstance (51%). Being a visionary (36%) and outworking everyone else (32%) are also seen as important, especially among those earning over $100,000, where this belief rises to 40%. More than a third of people (35%) believe in the importance of "paying yourself first" by saving money and planning for retirement. However, among Gen-Z and Millennials, 19% believe that "fake it ‘til you make it" is a key strategy for success.
### Gen-Z’s High Threshold For Financial Success
Gen-Z's financial expectations are significantly inflated, potentially setting them up for disappointment as they enter the workforce. This discrepancy is likely fueled by the pervasive influence of social media, which often presents a distorted view of wealth and success.
Social media is filled with curated images and videos showcasing luxurious lifestyles, extravagant purchases, and seemingly effortless achievements. On these platforms, people frequently highlight their successes without revealing the hard work, setbacks, or financial struggles that may lie behind the scenes. This selective portrayal creates an illusion that wealth is easily attainable and that success is defined by material possessions and lavish experiences.
As a result, younger generations may develop skewed expectations about their own financial prospects and life trajectories, leading to feelings of inadequacy or disillusionment when their realities do not align with the polished narratives they encounter online.
Additionally, Gen-Z's limited exposure to the job market and economic cycles may contribute to an unearned sense of optimism, potentially setting the stage for future disillusionment as they navigate the realities of the professional world.
Gen-Z has come of age in an era marked by economic instability. Their developmental years have been significantly influenced by major economic disruptions, including the COVID-19 pandemic, the highest inflation rates in over four decades, the burden of substantial student loan debt, and a challenging housing market that has become increasingly inaccessible to many Americans. These factors have likely contributed to shaping their perceptions and expectations of what it means to be financially successful in today's economy.
### Strategies for Gen-Z to Make More Money
As you transition into the workforce as an adult, it's essential to shift your mindset. Life is no longer all about attending social events or owning the latest gadgets. Instead, your focus should be on establishing a solid foundation for a thriving career.
To secure a higher-paying position, you must concentrate on developing and honing your skills. You should be actively seeking additional responsibilities in your current job to gain visibility among decision-makers at your company.
Outside of work, networking with industry professionals is essential, as well as researching salary trends in your field. Be ready to negotiate your salary when you receive a new job offer or are up for a promotion and raise.
As you accumulate experience, consider pursuing leadership opportunities and obtaining relevant certifications to further enhance your qualifications.
In addition to professional strategies, effective financial moves can significantly contribute to your success. This includes having a financial plan, increasing retirement savings through options like 401(K) investments, and investing in stocks.
Having a financial safety net allows you the flexibility to pursue your career aspirations without as much pressure.