Study: Younger generations’ finances more affected by COVID-19

Young couple doing their paperwork together, paying bills onlineImage: Young couple doing their paperwork together, paying bills online

In a Nutshell

Members of Gen Z were the most likely to have received unemployment insurance or experienced food insecurity during the pandemic. But among those who received benefits, millennials and Gen Xers were the most likely to feel that government or other programs were crucial to their ongoing financial stability. And across generations, people have the urge to save as a result of the pandemic.
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A year into the pandemic, people are struggling — especially those in the younger generations.

Credit Karma and Qualtrics’ latest joint survey found that less than half (49%) of Americans feel financially stable after a year of coronavirus precautions. By contrast, 69% of respondents said they felt financially stable before the pandemic.

Although the pandemic has upended financial stability for many, this study uncovered nuanced dual trends about the financial effects of the virus across generations. A greater percentage of Gen Z (ages 18 to 24) respondents to this survey said they received unemployment benefits and experienced food insecurity than those in other generations. However, among people who received benefits, millennials (ages 25 to 40) and Gen Xers (ages 41 to 56) felt the financial effects more. (For this study, food insecurity was defined as “the state of not having reliable access to a sufficient quantity of affordable, nutritious food.”)

Perhaps because of the insecurity brought on by the pandemic, saving has become more important for Americans. Possibly because of a lack of regular stimulus checks and no end in sight to many of the COVID-19 restrictions, many survey respondents agree that emergency savings are very important.

Read on to learn more about the trends our study revealed, as well as some resources for people filing for unemployment insurance benefits or seeking help with food insecurity.

Key survey findings

In 2020, 22% of all survey respondents received unemployment benefits, compared to 46% of Gen Z respondents. As of February 2021, only 13% of the entire respondent pool was receiving unemployment benefits, compared to 29% of Gen Z.
At any given time during the pandemic, about 25% to 26% of those surveyed experienced food insecurity. For Gen Z, 45% to 50% faced food insecurity.
Gen Zers were more likely to say they experienced unemployment and food insecurity than other generations. However, among respondents who received unemployment or food benefits, Millennials and Gen Xers were the most likely to say their financial stability depended on receiving these benefits.
37% of survey respondents reported feeling that their financial situation worsened as a result of  the COVID-19 pandemic.
An astounding 82% of respondents said that the pandemic demonstrated the importance of having emergency savings, which might explain what motivated 29% of survey takers to save money during the COVID-19 outbreak.

Gen Z was hit harder by the pandemic than other age groups

Unemployment claims skyrocketed during the pandemic. Overall, 22% of respondents said they received unemployment benefits in 2020, and 13% said they were receiving unemployment benefits in 2021.

In comparison, more than twice as many Gen Z respondents said they received unemployment benefits in 2020 or 2021.

Generation Percentage receiving unemployment benefits in 2020 Percentage receiving unemployment benefits in 2021 Percentage reporting food insecurity, on average
Generation Z 46% 29% 48%
Millennials 28% 19% 33%
Generation X 20% 11% 25%
Baby boomers 9% 5% 14%
Overall 22% 13% 26%

What’s more, Gen Z respondents were five times more likely to receive unemployment benefits as baby boomers in 2020, and nearly six times more likely in 2021 (so far).

Similarly, a member of Gen Z was three times as likely to have said they experienced food insecurity at some point during the pandemic in comparison to baby boomers.

According to this survey, as generational age decreases, financial and food instability increases during the pandemic. This trend could be tied to younger members of the workforce tending to be employed in jobs that were more vulnerable to disruption in the pandemic. According to the U.S. Bureau of Labor Statistics, the majority of workers ages 16 to 24 are employed in the leisure and hospitality, food service and retail industries — most of which were disproportionately affected by pandemic closures.

Millennials were more likely to feel negative financial effects

While Gen Z respondents were the most likely to have received unemployment benefits in 2020 and 2021, among those who got unemployment benefits, they were the least likely to have said that their financial stability depended on getting unemployment benefits.

In a reversal of the trend outlined above, at least among those who received benefits, millennials and Gen Xers were generally more likely to feel that they needed unemployment benefits to remain financially stable or to be reliant on government programs or food banks to eat.

Among respondents who said they were receiving unemployment benefits at the time of the survey in 2021, 74% felt that their financial stability was reliant on receiving those benefits. Gen Z’s need for unemployment to retain stability was dramatically lower, at only 54%. Meanwhile, 80% of millennials and 84% of Gen Xers felt that their unemployment benefits were crucial for staying afloat financially.

Generation Among those receiving unemployment benefits in 2020, percentage agreeing their financial stability relied on their benefits Among those receiving unemployment benefits at the time of the survey in 2021, percentage agreeing their financial stability relied on their benefits Among those who indicated experiencing food insecurity, percentage relying on government programs or food banks to eat
Generation Z 51% 54% 49%
Millennials 78% 80% 59%
Generation X 80% 84% 55%
Baby boomers 67% 75% 44%
Overall 70% 74% 53%

Likewise, among those who said they experienced food insecurity during the pandemic, millennials and Gen X were more likely to have turned to either a government program or a food bank.

Gen Xers and millennials are more likely to be living independently from their parents than Gen Z, and they also have a higher likelihood of having their own household to support. These two generations may be less able to turn to others for help supporting themselves than Gen Z.

Baby boomers also seem to be more insulated from the need for governmental or organizational help to get by during the pandemic. This may be because more baby boomers are closer to retirement and are able to subsidize unemployment benefits with savings. For baby boomers with children, their kids could offer another potential avenue of assistance. Boomer parents could turn to their kids for help with housing, money or food before seeking help from a government or other agency.

People are wild about saving as a result of the pandemic

The COVID-19 pandemic has demonstrated the importance of having emergency savings for a whopping 82% of Americans.

Almost 30% of survey takers managed to save over the course of the last year, and some of them have tucked away an impressive amount of money. Of those who saved, 49% saved $1,500 or more. And the vast majority (84%) said that they’ve saved up at least $300.

This tracks with Federal Reserve data showing that the proportion of Americans able to cover an emergency $400 expense in cash or its equivalents has been on a steady rise over the course of the coronavirus pandemic.

When asked how they primarily planned to use a future stimulus check, 30% of respondents chose saving, making it the second most popular choice behind spending it on necessities like groceries and rent (41%).

Stimulus checks have come at an uneven cadence, and it seems likely that COVID-19 restrictions will continue for many more months. These two factors could potentially explain the increased interest in saving.

Resources for dealing with unemployment benefits and food insecurity

Unemployment benefits

The U.S. Department of Labor has a dedicated site for COVID-19 unemployment insurance information. It even includes a map that helps you find where to file for unemployment benefits in your state. This is important because unemployment is distributed on a state level, not federally.

Credit Karma also has an article on filing for unemployment and another on dealing with unemployment benefits during tax time, which is coming up soon. While in 2020 it was possible for the self-employed in certain states to receive unemployment insurance, these benefits may not be currently available everywhere.

Help with food

If you’re having trouble putting food on the table, one of your first stops should be the USDA’s National Hunger Hotline. The agency can help you understand what your options for aid might be. For English, call 1-866-3-HUNGRY (1-866-348-6479). Spanish-speakers can use 1-877-8-HAMBRE (1-877-842-6273). Both hotlines are staffed Monday through Friday, 7 a.m. to 10 p.m. Eastern time.

If you’re curious about food stamps (also known as the Supplemental Nutritional Assistance Program, or SNAP), you’ll need to visit your state’s social services site. You can find out more at the U.S. Department of Agriculture website.

If your child relies on free or low-cost school meals, the USDA has set up a tool to help you feed your child.

Although it can feel difficult, if you need help right away, you should consider asking friends or family for help with food. You can also use the internet to find local food pantries or religious organizations or other nonprofits nearby with food donation programs.

Other help


On behalf of Credit Karma, Qualtrics conducted a nationally representative online survey in February 2021 among 1,041 American adults to understand how COVID-19 is affecting peoples’ finances one year into the pandemic.

About the author: Gaby Lapera is a researcher and writer at Credit Karma and a personal finance expert. She also spends time working on investing and science communication. Gaby graduated with a master's degree in biological anthropolo… Read more.