Jacob Smagula is a student at Claremont McKenna College and student manager at the Dreier Roundtable. Zoe Yu is a writer and student at Harvard. They write in The Boston Globe:
Over the past decade, the share of people under 25 with investment accounts has increased sixfold — but much of this activity doesn’t resemble what we usually think of as traditional investing. Two in 10 Gen Z investors invest only in crypto. Half of Gen Z and nearly half of millennial investors trade stocks weekly or even daily, chasing short-term market moves rather than making long-term investments. At the same time, the explosion of gamified brokerages, sports betting apps, and prediction markets has made speculating and gambling possible on nearly any phone.
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When the future looks this bleak, young adults begin to feel that they’re falling behind, even when they’re doing everything “right.” If the traditional path of getting a degree, landing a job, and saving carefully can’t come even remotely close to producing a down payment on a home, then taking bigger financial risks starts to feel less and less reckless and more and more like the only option. If your paycheck can’t keep up with monthly expenses, much less catch up to housing prices, it’s easy to stop believing that patience will ever pay off. In effect, the lottery economy is no longer confined to the poorest households. When low-income people feel economically stuck, they’re more likely to turn to buying lottery tickets, creating a regressive tax on desperation. This logic now fuels how young adults approach their finances. The idea of a single big win — a parlay, a meme coin pump, or a lucky options contract — promises the kind of financial success that saving can no longer guarantee.