Getting real about money with Gen Z

Brian Ford (00:09):

Welcome to Money and Mindset With Bright and Brian, a podcast that explores how managing your money right, mixed with a little positive psychology, can help you find more happiness. I'm Brian Ford, head of financial wellness at Truist. I'm joined by my buddy, Bright Dickson, Truist's, very own expert in positive psychology.

Brian Ford (00:28):

Bright on a scale of one to 10, how are you today?

Bright Dickson (00:33):

Ooh, quantifying my feelings. I'm going to say on a scale of one to 10 today I'm green. I don't know how you want to interpret that, Brian, but I'm excited to welcome today's guest.

Brian Ford (00:44):

Well, you didn't ask me, but I would say I'm a solid 8.7.

Brian Ford (00:49):

I'm really excited to welcome today's guest and dig into some truths about money. I am definitely a believer in being honest about money, but it's not always easy. That's not always the case. Money can be awkward to talk about. Some of us were raised to keep our financial lives completely private. On today's show, we're going to discuss why being more honest about money can really help us.

Bright Dickson (01:11):

Yeah, it really can. And I think it's really about information. When you have accurate, honest information available to build budgets and reach goals, those plans are just more likely to become a reality. And having that truth about money also means that we make fewer of our money decisions based on emotions and impulse, and it's so much better to make our decisions thoughtfully and confidently. I'm ready to take the awkwardness out of talking about money taboo topics with our guest Aleksandra.

Brian Ford (01:42):

Yeah. And on the other side of that awkwardness, we're going to have ideas and to-dos that we can all use just in our personal lives to get us in a better place financially. It's going to be a good one. So, let's get the show started and bring in our guest.

Bright Dickson (02:03):

Our guest this episode is an expert on the financial lives of young adults today. She's an entrepreneur and a tech company founder, and she'll tell you she lives and breathes sharing the truth about money every single day. Aleksandra Medina launched Frich in 2021, and she's come today to talk about why being honest about money, tackling those taboo topics is really important for people in their 20s.

Bright Dickson (02:26):

Aleksandra, welcome to Money and Mindset.

Aleksandra Medina (02:28):

Hi both. I'm so excited to have this conversation with you.

Brian Ford (02:32):

Yeah. And for some of our listeners, just wanted to let you know that Aleks was a guest on our podcast last month. She was so awesome. We're like, "You've got to come back again." She was gracious enough to do that. Aleks, can you explain what Frich is about and why it's beneficial to users who want to come out of the dark about money?

Aleksandra Medina (02:54):

For sure. I think you guys did a great job already alluding to a lot of the work that we do at Frich. But Frich stands for f-ing rich. So, I think that should give you enough context about what our mission is for our users. But just in general, what we do is we really focus on young people, and we help them understand how they compare to the people around them and their peers. So, if you download the app, you can give us a little bit more information about you so we can put you in the right benchmark group. And then really within the app, we cover all life topics and how they revolve around money, and we really use that as an opportunity to start honest conversations. And if we see that you might be falling behind in some topics or you, as a user, feel like you want to improve, we combine you with some tools and resources that really would fit you and your financial background.

Bright Dickson (03:49):

I love that, Aleks. That's so cool. One of the posts that I saw about money from Frich, it sort of had this reassurance that at age 22, you've only been an adult for two years. And I love that because starting from this place of like, hey, it's okay, you're new at this, everyone's new at it at some point, and you're new to this adulting thing, if you're in Gen Z.

Bright Dickson (04:13):

Aleks, correct me if I'm wrong, but Gen Z isn't exactly like other generations in their mindset, are they? What's different about Gen Z?

Aleksandra Medina (04:22):

So many things. I think one of them is just, which I don't think is specifically different, but maybe just intensified, is because we don't really talk about money, we don't realize how central money is in everything. So when we say we talk about money, we talk about everything. We talk about how much should you be spending on alcohol, or how much do you have in student loans, or are you being underpaid in your job? Because experiencing all these things for the very first time, and you don't know what "normal" is. But we can help you understand, okay, this is where you stand, this is where everyone else is, and this is maybe some parts where you should start focusing and go one by one.

Aleksandra Medina (05:06):

Because I do think that money is just such an overwhelming and alienating topic, and it just in general makes people feel very, very lonely because they think that they're the only ones that don't understand it. And obviously, I don't know the answer to why it's so taboo to talk about money, but I think one of the reasons is because our parents experienced a great recession. And I can only talk about my upbringing and my experience, but that was not something that was openly talked about in my home. We just kind of all saw that things were really, really bad suddenly, and we couldn't have what we wanted. But there was no explanation as to why. There was no reasoning or lessons to learn of how do you deal with such a crisis that is so out of your control?

Aleksandra Medina (05:59):

And speaking of crises that are out of your control, I think this generation specifically has had these once-in-a-lifetime experiences that have never happened ever before. Like COVID, if you're 20 years old and COVID starts, how do you even pick a major? How do you even plan a career? How do you decide whether or not a student loan is worth it? How do you decide which city to live in? There are so many firsts that you have to figure out as a young adult within this very, very first-in-a-lifetime context that has absolutely no blueprints. And then after COVID, now we have AI coming and disrupting everything all over again. And again, the blueprint of what you're supposed to be doing is again, completely thrown out because there's just this lack of stability and predictability.

Aleksandra Medina (06:54):

And I think that is a core thing that makes it so difficult for Gen Zers is that no longer is there this predictability of, oh, if I do X within five years, I'm going to get Y. That's just not a reality anymore. And I think at some point it becomes so overwhelming that you just don't want to talk about money at all, and you don't want to face it at all. And that obviously is not the answer. So this is why Frich exists, and why we do what we do.

Bright Dickson (07:26):

Aleks, I know that that part of the app is anonymous. Are you finding that it helps people be bolder about talking about money? If they can do it sort of anonymously in the app, does that extend to their real life?

Aleksandra Medina (07:40):

That's the hope for sure. I think our ability to redefine what it means to talk about money, it's not just, oh, what percentage raise are you going to be asking? But it's just also things like, I broke up with my boyfriend. What am I supposed to be doing now? We shared an apartment together. That's a conversation about money. So that's something that we really hope that we succeed with is that when we talk about money, we don't really talk about like, oh, what's the interest rate of your high yield savings account? We talk about like, okay, if you can sense a breakup coming up, how much money do you need to transition and to move out or to buy a new couch or do all these things? So, by having these very, very human conversations about things that actually happen to people, we can tie the conversations back to money.

Aleksandra Medina (08:35):

So my hope is that when people see this in the app or read an article or see a video that we've done on it, if their friend comes to them and says, "Hey, we just broke up," you now have the tools to be an even more help... Of course, provide emotional support, but afterwards also be like, okay, let's get a little practical. As a good friend to you, I want to make sure that you're safe. You have the tools. You have the resources. You're thinking soundly in this very emotionally heightened situation. So I really do hope that by making this connection between things that happen in our lives, as just regular functional human beings, that we can make those connections on how different financial decisions and products can help you be more empowered to take care of yourself. And to handle these very difficult situations in a way that still keeps you safe and sound.

Bright Dickson (09:35):

Yeah, and I love that. It's exploring sort of the nitty-gritty of the money relationships and how it impacts your emotional life and your personal life, right? All of that really matters. And a lot of us really are ashamed to talk about it, or to ask those questions. Or to just be like, "Okay, what do I do now?" And I think that's hugely helpful and brave in a way to open up that conversation.

Aleksandra Medina (10:00):

Yes. Oh my God, I'm so glad you're asking me this because the questions are hilarious. We've had some really, really funny topics we've covered, because we also allow people to submit questions. So it is quite funny to see what people come in and ask. But if I have to reflect on some of them maybe more surprising topics that really took off and started a conversation. I think one of them that was hilarious to see people argue was Venmo etiquette. So what is the proper etiquette if you are sending a Venmo request or receiving a Venmo request? Because it is a very awkward situation, right? Like if you go out to a dinner and there's always so many nuances. Like maybe someone didn't drink alcohol, or someone didn't have an appetizer or dessert. How do you split the bill? And then afterwards, let's say you put your card down, because you want the credit card points, and now you're sending the Venmo request and your friend does not respond and does not Venmo you back, how do you... Because it's so awkward to be like, "Hey, can you send me that money?" So that conversation was so fascinating to see unravel. Specifically, the first couple of dates you go on with someone, is this a red flag or not? And that opens up actually such great conversations. I really, really enjoyed that topic.

Aleksandra Medina (11:26):

And then, oh, this one was good. We did it around Thanksgiving and Christmas time. Whether or not your friends secretly think you're a bad house guest. And what is the unspoken etiquette of how do you attend a house party? What should you be bringing? What should you be offering? How should you behave? Can you bring plus ones? Should you be offering all these things? And that also just like, I think obviously the United States is such a big and diverse country, and everyone has such different perspectives on this question. And I think it just also started such a good conversation. Because it's one of those things that you're never really going to talk about it and you might just feel a little bit slighted by your friend or feel a little bit like, ugh, that was not cool that you did that. But you probably won't bring it up. So I think finding those questions and those topics where we're all kind of secretly thinking about it, but we never talk about it, those usually open up to some really, really interesting conversations.

Brian Ford (12:27):

Yeah, I think that's fascinating. And you mentioned a few of the questions that come up in the app. I'm almost, I'm wondering a little bit about like, are there answers that surprise you? And I'm a dad of a few Gen Z kids. I really like the information on wedding engagement expectations. I think some of the options that are out there, like choosing a lab-grown diamond. I think these are interesting ways to think about the costs of a proposal and setting yourself up for less debt as a newly married couple. But can you think of Aleks, some interesting, surprising answers to some of these questions? Because I think that the conversation is what's important. But does anything come to your mind as far as some of these answers that people are coming up with?

Aleksandra Medina (13:12):

I think I wrote those questions because I'm getting older as well, and I'm like, "I wonder what's normal to expect?" But also, I'm seeing my friends getting engaged and married and I'm just kind of curious in like, how much are you guys spending? That seems kind of crazy.

Brian Ford (13:29):

And it doesn't have to be just answers on that particular question, almost just answers in general. Like I even though the question that you had about red flags on first dates, does this mean that the person's going to manage their money poorly? But any type of answers that you can think of as far as good conversations that have gotten going on the app.

Aleksandra Medina (13:47):

The questions about engagement, actually, I was surprised about how little people seem to care. It seemed like kind of what you brought up, like more people were saying, "I don't really care whether or not it's a real diamond. If it's a lab-grown diamond, that's fine with me. You don't have to spend crazy much money on it." I think the idea of also a lab-grown diamond has so many parallels with what Gen Zers tend to care about. Like it's better for the environment of course. But I think also the other side of lab-grown diamonds, which I don't think people admit publicly, is that because it's cheaper, you can have a visually larger ring that you can then show off on social media. So I do think there's an element there that's like... I don't think people are going to honestly say that out loud, but I do think that's a very, very big aspect on that.

Aleksandra Medina (14:46):

But the engagement questions, I really liked those because I think they allowed us to have a lot more of a "strategic conversation" about getting married. People like to think of like, oh, it's so romantic, it needs to be a surprise. It's going to be so perfect. But we really wanted to push this angle that getting engaged or getting married, it's so much more than just the romance. You need to be compatible in so many ways. And in one of those things is you need to talk about money. And we actually followed up on that question because the average age people said that they want to get married or engaged was 28, which I think is quite late in my opinion. Or later than it used to be. But we followed up with that being like, okay, it doesn't matter. Getting engaged at 22, getting engaged at 32, doesn't matter.

Aleksandra Medina (15:40):

But from Frich, we really think you should have these conversations. And we talked about like it's okay for you to ask your partner if they have a lot of debts. It's okay for you to ask them, do they want to have a high stress, high earning career? Or do they want to have more relaxed life? Or do they want to live in a big vibrant city that's going to be really expensive? Or do they want to live in a lower cost area, and have a way more relaxed life? So I think, again, taking this topic that's so emotionally charged and has so many social expectations, and so much stigma around it. But then being like, "Okay, but actually this is going to hopefully be the person that you're going to end up being together with for a really long time." And it's, getting married is one of... or choosing who you get to marry, get to marry is one of the most important financial decisions in your life. And we want to make sure that you're making this decision wisely. Even if it's not really that comfortable to admit that it's not just about the romance, it's your partner in so many different ways.

Bright Dickson (16:55):

So Alex, I'm curious about hobbies. So I have an expensive passion. I actually have several expensive passions. But one of them is horseback riding. So I'm a horse girl. So in the spirit of being honest about money, I'll say that I spend, like, I don't know, $500 just in lessons, right? Currently. And it's only going to go up from there. So how would you talk about that kind of thing on Frich? What's your take?

Aleksandra Medina (17:20):

Well, first of all, love that. But I think every single time we talk about money in this way, I have one answer, and it's, "You should enjoy money. That's why you're making money. That's why you're working is because you want to earn the money to spend it on things that you enjoy." And it's not bad to admit that you want to spend money on things that you love and enjoy, but within reason. And I think usually what we say is... And this is also I think an uphill battle with this generation that's so online and so constantly bombarded with everything, is that we usually recommend for you to just reflect on why you're buying these things.

Aleksandra Medina (18:06):

Is it because this hobby brings you so much joy? And in general, I think hobbies would be like a green flag for Frich. Or is it because you feel like you need to do these things to keep up with everyone else? Are you doing this because you're feeling FOMO or because everyone else is doing it? But if this is something that brings you so much joy, then you should do that and more. Because what's the purpose of money? You shouldn't just be hoarding it or be too afraid to spend it. I think part of being financially confident is knowing what are some certain things that have to happen with your income every month, rent, bills, savings, etc. etc. But then the rest, you should feel confident in your ability to spend the money in a way that brings you the most amount of joy.

Brian Ford (19:00):

Aleks, in my book, I talk about how you need to get very clear about what you care about. You need to know what you value. And you can spend your money on those things but stop spending it on stuff that you don't value, that you don't really care about, just so that you can look cool. So, I love that. So listeners, whether you use Frich to get that insider information or you decide in your own life to be a little bit bolder about asking questions about money, once you have that information, what do you do with it? We'll come back in our next segment to talk about putting this into action. Stay with us. We've been talking to Aleks from Frich about taboo money topics and how the philosophy behind her company is to get Gen Zers to share and learn together, like, what's the next step? What do we do next, type of thing.

Bright Dickson (19:52):

Yeah, what do we do with this information? So, let's hit some of these big taboo topics, salary, romantic relationships, and debt. So Alex, first for salary, what does knowing what others around you or others in the same profession do to give you confidence around your money? How does that work?

Aleksandra Medina (20:13):

I think there's a couple of reasons why it's important to know where you stand with your salary. One is to be able to clock if you're being underpaid. I think to be able to go to your employer and fairly argue that you need a raise, you need the data to support that. Everyone else doing X, Y, Z is getting paid this and I'm paid that. Is it because I'm underperforming? And if so, what can I do better? Or is it because that you're just taking advantage of me because I haven't been asking for a raise? So, the other thing I would say is because there's so much income inequality in this country, I think most people, especially young people, have a very false expectation of what a good income is and what a normal income is. So most people, I think I saw somewhere that Gen Zers had reported that you need to make something crazy like $700,000 a year to feel financially stable, which is so much money. And the truth is that a median salary for 20 something is roughly $50,000. And of course it varies state by state, but if I tell you that it's roughly $50,000, it's not that helpful. Because if you live where I live, which is Manhattan, you're probably making more just because living there is so much more expensive.

Aleksandra Medina (21:37):

So you shouldn't be feeling like, "Oh, I'm falling behind. I'm not doing as well as everyone else." You need to be able to contextualize your income within your industry, but also within your geographic location. So I think having those data points just helps you figure out, what is your next step? Is it you realizing that you are underperforming or underpaid? So then you need to really work on yourself and work on your career. Or you're just realizing, actually no, this is normal. And I'm just finding that my spending behavior is completely out of sorts. And I need to focus on some other things right now. So I think that's just a very, very good starting point.

Brian Ford (22:22):

Yeah, salary is totally taboo. I mean, very few people are talking about salary. I remember when I was in my 20s and 30s, I'd always be wondering, "Where am I at? What does that person make? Could I be doing more?" And so, I love how I jumped on the app. You take a couple screenshots basically of someone's LinkedIn and then it kind of gives you some information. And part of that information is kind of salary averages. So I'd agree just from a taboo standpoint, I think knowing various salaries is really helpful. Alex, in my book, financial Confidence, I discuss the importance of income and our earning potential. And I think no matter how much we make, we all want to safeguard, manage, and if possible, add additional sources of income throughout our life.

Aleksandra Medina (23:09):

Yeah, absolutely.

Bright Dickson (23:10):

Yeah. Okay. Next taboo topic, romance. Are money and love intertwined for Gen Z in a different way than for other generations? What do you think, Alex?

Aleksandra Medina (23:21):

God, yes. 100%. I think that's why it's so difficult for this generation because we are... Well, first of all, it's so expensive to rent or impossible to buy. So you are earlier than ever, faced with the decision of whether or not you should move in with someone. That's actually also a big topic we've been covering in app, is, at what point should you be moving in with someone? What do you do after a breakup? Have you ever avoided a breakup because you can't afford to move out? These are big questions. So for sure, the housing affordability is really putting pressure on young relationships. And then on the other hand, we recently covered different traditional marriage questions, but in the context of today's reality, where we're shifting what's normal in a young person's romantic life on marriage expectations, child expectations, professional expectations, like timeline wise. For example, would you buy a house with someone that you're not married to? Whether because you don't want to get married or because you're maybe in a same-sex relationship and you don't really feel comfortable doing it. Or you're just choosing to avoid marriage because you're just making a statement, which I think a lot of people are doing.

Aleksandra Medina (24:42):

So, I think the social changes in what a relationship is and just at what point people get married, should you be merging finances because you're dating someone for seven years, but you're not married? Should you do it before? How should you navigate? 'Cause there are people that choose to have children before marriage, or people that choose to buy property or start businesses together. So, these conversations, even though you're still in a relationship, they don't really happen automatically. It's not like, "Oh, well now we're legally married, so yeah, obviously it's split this way." But if you're making big financial decisions with someone and sharing and building a life together without this legal moment in your life, you still have to have these conversations and ask these questions. So, it has been very, very interesting to see how people engage with these questions and what their expectations are. So, we actually have very proactively talked about these kinds of non-traditional relationships. Not just same-sex relationships, but just straight relationships where you just choose not to get married.

Bright Dickson (25:57):

Yeah. And I mean, what you're saying is no matter what, you have to have the conversation, and someone has to start it and ask the questions. And we talked a little bit in the last segment about getting engaged and expectations around engagement. What were some of the questions that were, I thought they were really smart questions, that you should ask in your relationship sort of on that road to making things permanent? What are the questions you ask in those conversations?

Aleksandra Medina (26:24):

Yeah, I mean, to our earlier point, how much do you make? You should know how much your partner makes. And I think it's also very fair, and you should ask if this person has significant debt because you will become responsible for their debt as well. I think in today's climate, very fair question, do you want children? Because that is something, as the woman in the relationship, that changes a lot of things in your career or in your earning potential. And that can also be a lot of pressure for the other partner. I think this one is super awkward, and we've talked about this as well, conversations with parents.

Aleksandra Medina (27:07):

So, you should have as a child, a conversation with your parents asking whether or not you will inherit something. Do your parents have enough money to retire? Are there some unspoken expectations? Those are things that you should know, and then you also should have that conversation with your partner. And then I think also you can talk about just idealistic life goals like what's the lifestyle you want? Do you want to be 60 and running your own business or do you want to retire on some remote Italian island and just drink spritzes, and I don't know, tan and read books? Those are very different outcomes, and you want to make sure that you want the same thing. Obviously, everyone has the right to change their answer, but you kind of want to have somewhat of an understanding of what people are wanting to get out of their lives.

Brian Ford (27:59):

Good questions, Aleks. Now to the third taboo topic, debt. How much debt is Gen Z carrying, Aleks? Give us some insights there.

Aleksandra Medina (28:08):

Student debt, that's just a huge one. I mean, around half of people have student debt and obviously varies how much each person has, but it's not small amounts. I think credit card debt is also something that's on the rise. I think we see roughly a third of people consistently having some sort of credit card debt. That's something that we've chosen to really zero in on and really kind of get through people to try to realize what is it that they're actually using.

Bright Dickson (28:37):

And I think one of the reasons that debt can really pile up or the situations that it can really happen is when you're not working, when you go through some period of unemployment. So, if you're just out of school or you're job hunting or if you get laid off, all of these things happen, but even if you don't have a job, you still have to manage your money. What advice do you and your experts have about that? How do you handle that?

Aleksandra Medina (29:03):

Yeah, I mean that's such a difficult situation to be in because it just feels like you're just keep losing and losing and losing and you can't catch a break. So I think what we usually recommend is one, the reason for building this community is for you to realize you're not the only one. And I think that can help you catch a break and be like, "Okay." Take a breath in. "I'm not the only one. There are other people doing it. There are other people that have done it before." So that's the first one. Just acknowledge that you're in this situation and you're not the only one. Then the second one, which this is a really, really sad realization for us, people really don't know where they stand financially because we're not really taught to have these honest conversations and people aren't financially super literate. People avoid taking the time to look at their finances and really understand where they are.

Aleksandra Medina (30:03):

So, that's the next thing we recommend is just face it headfirst. How much do you actually owe? What is your situation? And then there's obviously a couple of different strategies on how to repay debt. I'm sure you, Bright have talked a lot about it. There are some choices you can take that just are going to save you the most amount of money and are going to help you repay debt the fastest. But there are some that help you just have quick, small wins that will give you the motivation and the hope that you can get through that. So, you need to be realistic and choose a repayment strategy that will motivate you to keep going and be realistic with the situation that you're in.

Brian Ford (30:44):

Yeah. Aleks, so at Truist, we do teach a couple different debt reduction ways, I should say, and it's sometimes nice that I guess the math on paper it says you start with the highest interest rate, but sometimes if there's some of those quick wins like you mentioned. If there's some debt that's under $1,000 and you can just knock that out and it'll help build momentum, then let's start there. And then only when you get maybe above the $1,000 do we want to start looking at interest rates and prioritize it that way. So, I agree with you. Sometimes quick wins can be great, and I love how we're just talking about how it's just about honesty. It's facing things straight up. I love how the app, it's like, "Hey, this is where I'm at now and I need you to help me make a good decision." I love that.

Bright Dickson (31:29):

Yeah. And it's accountability, right? We all need to talk to each other and get towards our goals together. We need each other.

Aleksandra Medina (31:37):

Yeah, I know. I mean, we have such a great community out there, people having the same problems and struggles. It's just we should be more open to having these conversations and helping each other out.

Brian Ford (31:49):

Yes. Aleks, thanks for being on our show. You have given our listeners some wonderful things to think about. Thank you.

Aleksandra Medina (31:57):

Thank you for having me.

Brian Ford (32:02):

Okay. So, we tackled some taboos. We talked about salary, we talked about romance. We talked about debt. I hope you enjoyed today's show. That wraps up another episode of Money and Mindset With Bright and Brian, we hope you've been inspired to be bolder and more honest with your conversations about money. Please share this episode with someone you know who could use some help building their financial confidence. We want to thank our guest, Aleksandra, thank you so much. You can connect with her company, Frich through getfrich.com or @FrichApp on Instagram. Until next time, thank you so much for joining us.

Bright Dickson (32:38):

Brian and I will have another episode ready to share next month. You can find all our resources at truist.com/money-mindset. And if you like today's episode, please rate the Money and Mindset Podcast wherever you get your podcast. It really helps people find the show and get moving on their financial goals. See you soon.

Unknown Speaker (33:04):

This episode of Money and Mindset With Bright and Brian is brought to you by Truist.