6 Tangible Ways 'Financial Flexing' Is Costing Gen Z
More than half of Gen Z admits to lying about their money in order to appear more successful they actually are. It's the modern remix of "keeping up with the Joneses," staged for a first date or an Instagram story.
The bill for faking it doesn't come due immediately, but it will eventually show up in delayed savings, damaged credit and debt that outlasts whatever impressed whoever you were trying to impress. Here’s what financial flexing is and the ways it’s costing Gen Z.
What Is Financial Flexing?
Financial flexing is faking wealth you don't have. It's about controlling how others see you, especially in a romantic setting.
According to a Credit One Bank survey, more than 54% of Gen Zers (and 48% of Millennials) exaggerate or lie about their financial success. More than a third of respondents (37%) said they’re willing to overdraw their bank account or incur debt just to impress their date. Percentages are higher amongst men than women, but neither group is immune.
People flex their finances in all sorts of ways: an expensive date, a luxury experience, a higher-end product bought because everyone else seems to have one.
The result is that these people look like they’re making it big. The reality is often that they’re struggling just as much as (or even more than) anyone else.
Consequences of Financial Flexing
Splurging every now and again isn’t necessarily a bad thing. As long as you’re actually able to pay for what you’re getting without carrying a balance, it’s not even necessarily considered financial flexing.
But going from the occasional splurge to full-on trying to impress people is a slippery slope. Left unchecked, it can lead to overdrawn accounts, damaged credit scores and debt that’s difficult to pay off.
These are the six most tangible ways financial flexing is costing Gen Z.
1. Incurred Debt
The most immediate consequence is more debt, especially high-interest debt like credit cards or short-term loans.
According to Experian, Gen Z’s average credit card debt is $3,493. That's the lowest of any generation, but it's not the only debt this generation carries. Many are also juggling student loans and auto loans. Add financial flexing into the mix and you’re left with even greater debt loads that are difficult to repay.
Elisabella Ricca, a personal finance and consumer analyst at TopCashback, referenced a recent survey they did that "actually found that 36% of people have used credit for social spending they couldn’t fully pay off."
2. Little to No Savings
Gen Z has the lowest average savings across all generations. The Federal Reserve’s latest Survey of Consumer Finances found their average transaction account balance is $20,540. The median is just $5,400.
That's a gap that doesn't close on its own, and every flexed dinner or splurge purchase widens it. Financial flexing makes it far too easy to dip into what little savings exist just to keep an unaffordable lifestyle running.
3. Falling Behind on Payments
Less saved, more owed — that's the exact setup for missing a payment. Missed payments mean late fees, and in the scramble to catch up, those fees compound on themselves.
And if something happens, like a financial emergency, it’s even more detrimental. The Federal Reserve found that just 45% of people aged 18-29 could afford a surprise $400 bill using cash. The rest have to rely on credit or other options.
4. Damaged Credit
When you’re spending what you don’t have, you risk hurting your credit. It might not happen all at once, but it will over time.
That’s because your FICO score is made up of five categories: payment history, amounts owed, credit history length, new credit and credit mix. Financial flexing hurts the first two:
On-time payments (35% of your credit score): If you fall behind because of financial flexing, your creditors will report late payments to the credit bureaus, which hurts your payment history.
Amounts owed (30% of your credit score): The more you owe across all credit cards and loans, the more your score is impacted. Racking up a balance for an expensive dinner or designer item chips away at it slowly.
If you’re really not careful, you could end up falling so far behind on payments that your accounts go into collections. This doesn’t just hurt your credit score. It can also take months or even years to get your finances back on track once it happens.
5. Delayed Financial Goals
Focusing on instant gratification often comes at the cost of long-term goals.
“Spending money… instead of saving for your future or building up at least three months' worth of an emergency fund is not showing the world that you are successful, but only putting yourself in the danger zone,” said Cody Schuiteboer, president and CEO of Best Interest Financial.
Every month spent paying off credit card debt or funding a flex is a month that could have gone toward saving or investing instead.
6. Inability To Build Wealth
Maybe the biggest cost of financial flexing is that it quietly kills your ability to build real wealth.
“Many Gen Z individuals conflate being rich with being wealthy,” said Ricca. “Being rich means having a lot of possessions — cars, homes, jewelry, etc. Since it involves what people can see, it’s naturally more flashy. Wealth, on the other hand, is sustainable and not always as obvious.”
Owning a bunch of stuff doesn’t mean you’re wealthy. True wealth is about having a high net worth. This is your assets (like home equity or savings) minus liabilities (think: credit card debt).
You can look rich for years and still be worth less than zero. That's the flex nobody posts about.
The Bottom Line
None of this means you shouldn't spend money on nice things. It just means knowing the difference between a splurge you can afford and a performance you can't. The people financial flexing is designed to impress usually aren't checking your credit score, but your future self will have to.
It's important to remember that real wealth doesn't post. It compounds quietly, while everyone else is still paying off the illusion.
This article was provided by MoneyLion.com for informational purposes only and should not be construed as financial, legal or tax advice.
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