How ‘Vice Economics’ is quietly emptying Generation Z’s bank accounts

For decades, The financial advice was simple: spend less and save more. But for many young people today, the message seems outdated. The culture around money has changed: shaped by social media, the dopamine from investing apps, and an economy that rewards indulgence as self-care.

What used to require a trip to the casino now resides on the same phone used to check the weather or send a text message. Sports betting, meme stocks, prediction markets, and “little gifts” purchased for the sake of Tik Tok trend They are all part of the same cycle: Money was replaced by a temporary rush.

The result is a growing disconnect between financial goals and financial behavior. Generation Z and younger Millennials (groups that entered adulthood amid economic shocks, record inflation, and social media saturation) are more likely than older generations to describe spending as emotional or impulsive.

A Filene Research Institute 2025 report on “Deputy Economy” It found that even as wage growth improved, younger workers reported decreased confidence in their financial future. Nearly half said they struggle to resist impulse purchases or spending “fun money.”

Social media and the normalization of indulgence

The idea of ​​treating yourself is not new but social media has turned it into an expectation. The phrase “a little treat” has been used in more than 20 million TikTok posts, according to TikTok Marketing trend analytics. It now functions as a meme and a slogan: small extravagances justified as necessary moments of joy.

A Bank of America Survey It found that more than half of Gen Z say they buy themselves a small treat at least once a week. While the cost may seem small (a $7 coffee, a live stream rental, or an impulsive beauty purchase), behavioral economists warn that this type of routine, emotion-driven spending adds up. Over time, this erodes the small financial reserves that build stability.

I’m not trying here to tell you that not buying lattes will help you buy a house. But not buying lattes 3x a week will definitely put $100 back in your bank account every month. That’s $1,200 a year. That’s a third of the investment you’ll need to make by the time you’re 22 to become a millionaire.

The cultural feedback loop is powerful: influencers post their products as aspirational content, brands capitalize on the trend, and young consumers feel justified in their spending even when they’re financially stressed. This “feel good now” cycle has become one of the hallmarks of post-pandemic consumption.

Sports betting prosperity in your pocket

While small products gradually reduce savings, the new frontiers of economic vice are much more aggressive. Since 2018 Supreme Court to rule After allowing states to legalize sports betting, gambling has spread across the United States, largely through mobile applications.

TransUnion I mentioned Betting activity among consumers rose to 30% in 2025, up from 25% the previous year. Among Millennials, participation was 42%, and for Generation Z it was 34%. The vast majority of this activity now occurs on smartphones.

Online sports betting, fantasy leagues, and casino-like platforms are largely marketed to younger men, and often use the same influencer-driven channels as lifestyle brands. Analysts I found it States where sports betting has expanded have seen an increase in bankruptcies and a decline in credit scores among younger users.

Ten years ago, you had to walk into a casino to lose $500. Now you can do it anytime, anywhere.

The normalization of gambling (combined with constant accessibility) has made it one of the fastest sources of disposable income for younger adults.

Prediction markets and the “financialization” of gambling

Economic vice is not just limited to betting on sports or buying small luxuries. Increasingly, it is about the manipulation of finance itself.

Prediction markets (platforms that allow users to bet on everything from elections to the Federal Reserve’s interest rate decisions) have soared in popularity. In 2025, Robinhood launched a prediction market feature in partnership with KalshiAllowing clients to trade based on political and economic outcomes.

Robinhood, which once promoted itself as a tool to democratize investing, has entered the space with a bang New beginnings in sports Even the elections.

The appeal is clear: the interface feels familiar, it feels like an investment, and the payoffs are exciting. For many young users, these products fall into the same category as stock trading – a fast and entertaining way to make money.

But the risk profile is completely different. Where investing rewards patience and compounding, short-term prediction and speculation markets are built on volatility and emotion.

What does this mean for financial stability?

The consequences are starting to appear:

• Thinner emergency funds: Younger adults are more likely than previous generations to have less than one month’s expenses saved in an emergency fund, according to Pew Research.
• Delayed wealth building: Many who gamble or trade for short-term gains transfer money from retirement accounts or long-term investments.
• Emotional fatigue: The cycle of impulsiveness, guilt, and rationalization can increase money-related stress, especially among those who are already carrying debt.

Consumer advocates warn that although these behaviors may seem harmless individually, the cumulative effect is a generation more vulnerable to financial shocks.

The bigger picture

The vice economy did not appear overnight. It arose from the convergence of technology, marketing, and cultural fatigue. To a generation raised on financial uncertainty, indulgence and speculation may seem like control, small actions in an unpredictable world.

But as these small actions accumulate over time, they reshape the financial foundation of millions of families. Whether through a $10 cup of coffee, a $50 investment, or “just for fun” meme trading, the result is the same: less savings, more risk, and a generation that spends its future for the comfort of the present.

Don’t miss these other stories: