“One-third of Gen Z says they believe they’ll never be able to pay off their debt, and more than half believe they’ll never own a home.” – Fortune Magazine – January 2026
The observation that “one-third of Gen Z says they believe they’ll never be able to pay off their debt, and more than half believe they’ll never own a home” captures a profound shift in how an entire generation understands risk, reward and the social contract. It is not only a comment on personal pessimism; it is a snapshot of structural change in advanced economies, where the pathways that once linked effort to security appear increasingly broken for those now entering adulthood.
Generation Z – typically defined as those born from the late 1990s to the early 2010s – came of age in the long shadow of the global financial crisis, the COVID-19 pandemic and a decade of asset inflation that dramatically enriched existing owners while raising the drawbridge on those outside. Many of them watched parents endure job losses, foreclosures or long periods of stagnant pay. They arrived in the labour market as housing costs, tuition, healthcare and everyday essentials outpaced wages, and as credit – rather than income growth – became the central tool for keeping households afloat.
That background matters because Gen Z’s sense that debt is unpayable and homeownership unreachable is not an abstract mood; it is grounded in observable economic patterns. Surveys in the mid-2020s repeatedly show that young adults are more indebted relative to their earnings than earlier cohorts at the same age, more reliant on high-interest credit and less likely to hold the one form of debt – a mortgage – that traditionally builds long-term wealth. Analyses of US data, for instance, note that Gen Z consumers are far more likely to hold revolving credit card balances and personal loans while having low rates of homeownership, reflecting the way credit is being used to manage short-term survival rather than long-term investment.1,2
Homeownership sits at the centre of this story. In the post-war era, policy, tax systems and urban planning in many advanced economies were implicitly designed around the assumption that each generation would become homeowners earlier and at higher rates than the last. Property was framed as both a consumption good and the primary asset for retirement security. For Gen Z, that script has inverted. Young adults face a combination of historically high house-price-to-income ratios, elevated mortgage rates and large required deposits in many cities. Surveys in the mid-2020s suggest that a majority of Gen Z respondents doubt they will ever own a home, even though most say they would like to.3,5
The result is a psychological stance some commentators have dubbed “disillusionomics”: a way of thinking about money shaped by the belief that traditional milestones – owning a house, clearing debts, building a pension – are not realistically attainable on normal wages within a normal working life. Instead, Gen Z is often reported to be experimenting with alternative strategies: multiple income streams, gig work, high-risk investing, side hustles and very short planning horizons. They are also more willing to challenge inherited financial norms, questioning whether homeownership is still a rational goal or whether the effort required is simply disproportionate to the reward in a world of fragile employment and volatile asset prices.3
Debt sits at the heart of this generational fracture. Earlier generations embraced borrowing as a bridge to a better future: a mortgage bought a home that would appreciate; student loans were justified as an investment in higher lifetime earnings; consumer credit smoothed consumption as incomes rose. In contrast, many Gen Z borrowers experience debt as a trap rather than a lever. Credit is often used to cover basic living costs, not discretionary luxuries, and is serviced at interest rates that erode the possibility of saving a deposit or building a cushion. Surveys show worrying levels of delinquency among younger borrowers, as well as a growing share who say they carry more in debt than they hold in savings or liquid assets.1,3,5
This collision of rising costs, precarious work and expensive credit shapes their expectations. If monthly obligations already absorb most of their paycheque, it is rational for a young adult to conclude that a future mortgage deposit – perhaps requiring many tens of thousands in savings – is beyond reach. If they also doubt that their real wages will grow significantly over time, the idea that they can ever fully clear their debts appears equally implausible. The quote, therefore, is less about personal fatalism and more about a generation doing the arithmetic and finding that the numbers do not add up.
The changing idea of the “American Dream” and homeownership
The anxiety around homeownership for Gen Z must be understood within the longer history of the so-called American Dream and its equivalents in other advanced economies. After the Second World War, policy makers in the United States, the United Kingdom and elsewhere promoted mass homeownership as the cornerstone of middle-class life. Subsidised mortgages, tax advantages and large-scale suburban building programmes all worked to make ownership more accessible to industrial-era workers. Over time, however, the financialisation of housing turned property itself into a speculative asset class.
From the 1980s onward, deregulated credit markets, falling interest rates and global capital flows drove house prices up faster than incomes in many urban centres. Those who already owned property enjoyed capital gains; those who did not saw the ladder pulled further away. This dynamic was magnified after the global financial crisis, when ultra-low interest rates and quantitative easing again raised asset prices, particularly in housing, while wage growth remained weak. By the time Gen Z reached adulthood, the entry cost into the housing market in many cities had become historically high relative to average earnings.
Young people, facing this landscape, must decide whether to accept decades of austerity to chase a property purchase that may still be vulnerable to shocks, or to reorient their aspirations away from ownership entirely. Some surveys highlight that younger homeowners place a stronger emphasis on achieving “debt freedom” than on expanding into larger or more prestigious homes, reflecting a reframing of success away from accumulation and towards autonomy from lenders.8
Why this generation feels different: work, wages and volatility
Beyond housing, Gen Z’s relationship with work and income is shaped by instability. Many entered the labour market during or just after the pandemic, facing hiring freezes, remote onboarding and an unstable demand for entry-level roles. The rise of gig platforms and freelance contracting has created new opportunities but also shifted more risk onto individuals, who often lack benefits, sick pay or predictable hours.
At the same time, inflation spikes in the early 2020s eroded real wages just as rents and mortgage costs jumped. Younger workers, who tend to have lower starting salaries and fewer buffers, were hit hardest. Statistical analyses show that workers under 35 often earn substantially less than older cohorts, yet face similar or higher living costs, leaving less margin to repay debts or accumulate savings.4
Cultural responses to this squeeze have been widely reported. Concepts such as “doom spending” – the choice to spend now because the future feels too uncertain to save for – and “quiet quitting” reflect broader scepticism about delayed gratification in a system perceived as unbalanced. When asset ownership feels unattainable, the moral weight once attached to thrift and long-term planning is diminished. The logic becomes: if the system will not reward sacrifice with security, why sacrifice at all?
Intellectual backstory: debt, generations and the social contract
The sentiment encapsulated in the quote sits at the intersection of several major strands of thought: the political economy of debt, the sociology of generations and the analysis of asset-based inequality. Over the past half-century, a number of theorists and researchers have helped explain why a generation could come to view debt as permanent and ownership as implausible.
Debt as power and promise: from Graeber to financialisation theorists
The late anthropologist David Graeber drew attention to the deep moral and political dimensions of debt. In his influential work on the history of obligations, he argued that debt has long functioned as a tool of social control as much as an economic instrument. Modern consumer and student debt, in this view, discipline individuals to accept certain forms of work and life choices in order to stay current on their obligations. For Gen Z, whose entry to adulthood is defined by outstanding balances rather than accruing assets, this disciplinary function is acute: the need to service debt can constrain job mobility, entrepreneurship and even decisions about family formation.
Financialisation scholars have added a structural dimension to this story. Writers on the shift from an industrial to a financialised economy emphasise how profits have increasingly flowed from financial activities – including household lending – rather than from wages and production. Households, especially younger ones, are encouraged to become both borrowers and investors, taking on leverage to access housing and education while being exposed to financial market volatility. For those who arrive late to this system, such as Gen Z, the upside of asset inflation is limited, while the downside of inflated entry prices and heavy leverage is very real.
Intergenerational inequality: Piketty, asset owners and the young
Economist Thomas Piketty and colleagues have reshaped contemporary debate about inequality by documenting the long-run tendency for returns to capital to exceed the growth rate of the economy. When this happens, those who already own capital – including housing – see their wealth grow faster than overall output, while those reliant on labour income fall behind. For a generation born after asset prices had already been inflated by decades of such dynamics, the chances of catching up through work alone are slim.
Subsequent research has shown that wealth gaps between younger and older cohorts have widened significantly. The median young adult today typically holds far less net wealth than their counterparts did several decades ago at the same age, after adjusting for inflation. Much of this gap reflects property ownership. Older cohorts often bought homes when price-to-income ratios were lower and subsequently enjoyed price appreciation; younger ones confront elevated prices and must borrow more heavily relative to their incomes or exit the market altogether.
Life-courses under strain: sociologists of youth and precarity
Sociologists of youth and work have long studied how the transition from education to stable employment has become more fractured. Concepts such as “precarity” capture the rise of insecure work, fragmented careers and uncertain futures. Instead of a linear progression from school to a permanent job, to homeownership and family, many young adults experience looping paths, temporary contracts, and frequent sector changes.
This has consequences for how they view long-term commitments like mortgages. If you cannot be confident about your income five years from now, committing to a 25- or 30-year debt contract looks very different than it did to earlier generations with stronger expectations of continuous employment. The growing sense that careers are unpredictable weakens the appeal of the traditional wealth-building strategy of buying and paying down a fixed home loan.
Behavioural economists and the psychology of “no way out”
Behavioural economics adds another layer by explaining how people respond to overwhelming burdens. Research on present bias and scarcity suggests that when individuals feel permanently behind, they focus on immediate needs and relief rather than distant goals. In the context of Gen Z, heavy debt loads and high living costs leave little mental or financial bandwidth for retirement saving or long-term home purchase planning.
Studies on financial behaviour among younger consumers highlight a mix of caution and risk-taking: caution in the form of distrust of institutions, and risk-taking in high-volatility investments or speculative trades seen as the only routes to rapid advancement. The belief that conventional paths will not deliver – reflected in the quote – encourages some to either disengage from traditional financial planning altogether or to seek extraordinary upside via risky strategies. Both responses reinforce volatility in outcomes.
Housing economists and the end of automatic homeownership
Housing economists have been documenting for years how structural shifts have eroded the assumption that each cohort will own at higher rates than the previous one. They note the interaction of land-use restrictions, sluggish building in high-demand areas, demographic pressures, foreign capital inflows and speculative investment in property as an asset class. These factors collectively push up prices relative to local wages, particularly in attractive urban centres where many skilled jobs for Gen Z are located.
Work in this field has also shown how credit interacts with housing supply. Easier access to mortgage credit does not simply make housing more affordable; when supply is constrained, it can bid up prices instead. Over several decades, expanded mortgage availability without commensurate increases in housing stock contributed to higher entry prices. Younger buyers respond by either taking on higher loan-to-income mortgages – increasing their vulnerability to shocks – or by staying renters indefinitely.
Debt, education and the reshaping of risk
Education finance forms another crucial piece of the backstory. For many Gen Z students, higher education came with substantial tuition fees funded by loans, premised on the belief that a degree would reliably yield higher earnings. However, the combination of crowded graduate labour markets, credential inflation and regional mismatches in job opportunities has undermined this assumption for some. Where graduate salaries do not rise enough to offset accumulated student loans and elevated living costs, the debt-to-income ratio for young workers remains stubbornly high.
At the same time, financial literacy and debt management skills have often lagged behind the proliferation of credit products. Commentators on personal finance education emphasise that many young borrowers are entering adulthood with a complex mix of obligations – student loans, credit cards, personal loans, occasionally buy-now-pay-later schemes – without systematic guidance on prioritising repayments, negotiating with creditors or avoiding high-fee products. As a result, even manageable debts can feel unmanageable, particularly when combined with opaque interest structures and penalty regimes.6
The perception that one-third of a generation expects never to clear their debts is therefore not only about absolute amounts; it is also about opacity and a lack of confidence in the rules of the game. If you cannot easily see a route from your current obligations to a debt-free future, and if you suspect that the system is stacked to prolong your indebtedness, the rational inference is that the debt may be permanent.
Cultural narratives: from aspirational to sceptical
Popular culture both reflects and reinforces these economic realities. Earlier eras were filled with images of young couples buying their first home, steadily trading up and arriving at retirement with a paid-off property and supplementary savings. In contrast, much of Gen Z’s media diet is saturated with stories of financial burnout, housing insecurity, and the impossibility of catching up. Social media amplifies both extremes: displays of ostentatious success, often driven by non-traditional careers, alongside viral testimonies of people unable to afford basic milestones despite working full-time.
This creates a powerful comparative lens. Seeing peers accumulate substantial wealth through entrepreneurship, speculation or influencer careers, while conventional earners struggle to pay rent, can further erode belief in the legitimacy of traditional employment-based advancement. The sense of being “duped” – urged to follow rules that no longer yield the promised results – feeds into the disillusioned stance that the quote expresses.
Rethinking security in a leveraged world
Ultimately, the belief among many Gen Z individuals that they will never pay off their debts or own a home is not merely a reflection of generational temperament; it is a rational assessment of the constraints imposed by an economic model heavily reliant on household leverage and inflated asset values. It highlights fault lines in the implicit bargain that underpinned late 20th-century prosperity: study hard, work hard, borrow prudently, and the system will deliver stability and ownership.
As that bargain has frayed, a generation has been forced to reassess what financial security looks like when ownership is delayed, partial or permanently out of reach. Whether the response takes the form of quiet resignation, radical experimentation with new income models, political mobilisation, or a reimagining of what constitutes a good life without property, the starting point remains the stark insight captured in the quote: when debt feels endless and homeownership implausible, the entire architecture of aspiration must be rebuilt from the ground up.
References
1. https://www.realtor.com/advice/finance/gen-z-homebuying-credit-card-debt/
2. https://www.experian.com/blogs/ask-experian/average-american-debt-by-age/
4. https://carry.com/learn/average-debt-by-age
5. https://www.scotsmanguide.com/news/two-thirds-of-gen-z-think-they-will-never-own-a-home/
6. https://enrich.org/debt-isnt-the-problem-lack-of-debt-management-education-is/
8. https://www.kin.com/blog/american-dream-and-homeownership-survey-2025/
9. https://nationalmortgageprofessional.com/news/financial-hurdles-dominate-millennial-homebuying-plans
