Why Gen Z Is Borrowing More While Investing More

Deloitte put out a survey on October 8, 2026 that reads like two different generations wrote it. Deloitte’s ConsumerSignals survey found that the share of Gen Z borrowers carrying a credit card balance for more than a month rose nearly 20% between Q3 2023 and Q2 2026 — while that same rate fell for every other generation. Same survey, same people, found Gen Z also planning to put more of their savings into stocks, mutual funds, and retirement accounts than they did three years ago.

Not instead of the debt. Alongside it.

If I could get one idea through to you before you read another headline about Gen Z and money, it’s this one: the thing that makes investing work isn’t the investing account. It’s time, left alone, uninterrupted. And this survey is the clearest picture yet of a generation protecting that time with one hand while quietly spending it down with the other.

The short version

What’s true	What it means for you
Gen Z’s share of credit card balance-holders carrying debt past one month rose nearly 20% from Q3 2023 to Q2 2026, while every other generation’s rate declined (Deloitte ConsumerSignals)	You’re not watching a universal trend. You’re watching your generation specifically move the wrong direction while everyone older moves the right one.
Gen Z buy-now-pay-later use hit 22.8% in Q1 2026 — the highest of any generation in three years of tracked data — before easing to 17.6% in Q2 2026 (Deloitte)	More than one in five of you used BNPL at the peak. That’s not a niche habit anymore. That’s the default.
Despite the rising short-term borrowing, Gen Z respondents plan to put more of their savings into stocks, mutual funds, and retirement accounts than they did three years ago (Deloitte)	You’re not giving up on investing. You’re trying to do it with a leak in the bucket.
Deloitte surveyed roughly 1,000 U.S. adults 18+ every month from July 2022 through June 2026 — about 48,000 responses total	This isn’t a one-time poll with a small sample. It’s four years of the same question, asked the same way, every month.

Read the first two rows against the third one and you’ve got the whole post. Your generation is borrowing more than anyone your age has in recent memory, and planning to invest more than you did three years ago, at the same time. Those two facts don’t cancel each other out in the data. They cancel each other out in your bank account.

This isn’t two generations. It’s one, doing both

The easy read of this survey is that Gen Z is reckless with debt and that’s the whole story. The easy read is wrong. I’ve written before about how fast Gen Z’s debt is growing compared to older generations, and the pattern here fits — your rate of carrying a balance past one month climbed while Gen X, millennials, and boomers all improved. You’re the outlier, and not in the direction anyone wants.

But the same people answering “yes, my debt grew” are the people answering “yes, I plan to invest more.” That’s not two camps inside one generation. Deloitte’s Michelle Gauchat, the firm’s U.S. banking and capital markets leader, put it this way: Gen Z “came of age with smartphones, BNPL, and investing apps already at their fingertips — and they’ve entered a tough job market.” You didn’t choose between the disciplined path and the reckless one. You’re walking down both at once, because both apps are open on the same phone and both decisions get made by the same 23-year-old on the same Tuesday.

Why Gen Z is borrowing more than anyone else

Deloitte’s Stephen Rogers, managing director of the firm’s Consumer Industry Center, has a cleaner way of framing this than “irresponsible spending.” He calls it Gen Z “balancing financial discipline and optimism” — borrowing to get through a short-term squeeze while still funding the long-term plan. The job market made the short term feel unstable, so your generation is borrowing to survive it. The long term still feels investable, so you’re funding that too.

That tracks with what the entry-level job market has actually been doing to your generation — fewer junior roles, slower raises, a tighter runway between paychecks than the one your older coworkers had at your age. Borrowing to bridge a real, temporary income gap isn’t the same mistake as borrowing because you didn’t want to wait. The survey doesn’t say which one is driving more of the nearly-20% increase. Your own bank statement will tell you which one applies to you.

Why does carrying debt cancel out your investing gains?

Carrying revolving debt while investing cancels out your gains because the interest rate on the debt is almost always higher than the return on the investment. A dollar sitting in a credit card balance at 22%+ APR is losing value faster than a dollar in the market — averaging roughly 7% a year over time — is gaining it. You can be investing and still be moving backward, net, every single month.

The rate gap is the whole problem. Average credit card APR has been sitting at 22%+ for the past year, a number I’ve broken down before. The stock market’s long-run average return is closer to 7%. That’s not a small gap you can out-save. It’s a 15-point hole that interest digs faster than compounding can fill.
BNPL hides the same math behind friendlier branding. No interest if you pay on time — but a missed payment adds fees and, increasingly, a credit score hit, which quietly erases whatever the market handed you that same month.
The money doesn’t know which account it’s “supposed” to be in. A dollar going toward a BNPL payment isn’t a dollar going toward your Roth. It’s the exact same dollar, just pointed at a different outcome, and only one of those outcomes compounds in your favor.
You can’t offset a guaranteed loss with a probable gain. The interest on your balance is certain. The market’s return this year is not. Betting a sure 22% cost against a hoped-for 7% gain is a losing trade even when the market does well.

The math nobody’s running on a Tuesday

Say you’re carrying a $3,000 credit card balance at 22% APR and you’ve also got $3,000 sitting in a brokerage account earning something close to the market’s long-run average. The $3,000 invested earns you roughly $210 that year. The $3,000 in revolving debt costs you about $660 in interest over the same stretch. Net, you didn’t come out $210 ahead. You went $450 backward — while technically doing the “right thing” on both ends of your balance sheet.

That’s the trap in this survey. It’s not that Gen Z stopped investing. It’s that a generation genuinely trying to do the smart long-term thing is funding it on the same ledger as a short-term borrowing habit that costs more than the smart thing earns. Compound interest only works in your favor when there’s nothing competing against it. Put a 22% drag next to a 7% tailwind and the tailwind loses before it even gets started.

I know carrying both at once doesn’t feel like a math problem in the moment. It feels like two separate decisions — contribute to the Roth because that’s what responsible people do, use the BNPL button because the sweatshirt is $75 instead of $300 today. Nobody sits down and does the subtraction. That’s exactly why the subtraction needs to happen before the next paycheck, not after you’ve noticed the gap.

What to actually do this week

You don’t have to choose between “stop investing” and “stop borrowing” to fix this. You have to stop treating them as unrelated.

Put both numbers on the same page. Your total revolving balance (cards and BNPL combined) next to your total invested balance. Most people have never looked at both at once, because one lives in a banking app and the other lives in a brokerage app that doesn’t talk to it.
Pay off the higher rate before you add to the lower one. If your card APR is north of 20% and your expected investment return is closer to 7%, every extra dollar belongs on the card first. The “guaranteed 22% return” of paying off debt beats almost any investment you can make this year.
Keep the investing contribution automated, even while you’re paying down debt. Don’t zero it out entirely — the habit of putting something in every month matters more long-term than the exact dollar amount right now. Shrink it if you have to. Don’t kill it.
Treat every BNPL click as a loan against your own investing account. Because functionally, that’s what it is. The $75 you split into four payments is $75 that isn’t compounding anywhere for you.
Revisit the balance once the debt’s gone, not before. Once the revolving balance hits zero, redirect what you were paying in interest straight into the brokerage account. That’s the moment the math finally works in your favor on both sides at once.

The takeaway

Deloitte’s survey isn’t proof that your generation is bad with money. It’s proof that you’re trying to do two smart things at once without noticing they’re pulling against each other. The discipline to keep investing through an unstable job market is real, and it matters. But the debt you’re carrying at the same time is quietly spending down the one advantage investing early was supposed to give you — time, left alone, uninterrupted. Fix the rate gap first. The investing account will still be there, growing faster, once nothing’s competing against it.