Woman at cafe making mobile payment
According to new research from Cash App Afterpay, more than half of Gen Z say credit cards feel outdated, anxiety-inducing, and incompatible with how they want to manage their money. Unlike previous generations who saw credit cards as a rite of passage or a symbol of financial freedom, Gen Z is redefining what financial empowerment looks like—and credit cards don’t make the cut.
Why Credit Cards Clash With Gen Z’s Money Mindset
“Credit cards give Gen Z the ‘ick’—not just because of high interest rates and confusing terms, but because they feel outdated and anxiety-inducing,” said Lindsay Bryan-Podvin, Cash App Afterpay’s Financial Therapist. “Credit cards clash with how Gen Z wants to manage money. They want clarity, structure, and control in real-time, which is why they’re embracing alternative tools like debit cards and BNPL that offer greater transparency, flexibility, and speed for responsible spending and managing their cash flow.”
Credit cards also feel cumbersome. “For a generation used to getting things with the tap of a button, having to go through the tediousness of applying for a credit card and then waiting for it to arrive isn’t as integrated and user-friendly as BNPL,” Bryan-Podvin added.
Charlotte Principato, a financial services analyst at Morning Consult, echoed these sentiments. “Gen Zers are entering adulthood without being bombarded by credit card offers the way millennials were, with a heightened understanding of the dangers of credit card debt after seeing its impact on older generations,” she said in an interview with CardRatings.com.
Financial Wellness Is Gen Z’s New Self-Care
Forget bubble baths and yoga—Gen Z is bringing financial wellness into the self-care conversation. They’re prioritizing tools that help them stay mentally and financially balanced, with ease and autonomy at the center.
“Gen Z is redefining self-care, and extending those values to include financial wellness,” said Bryan-Podvin. “They’re prioritizing payment methods that support ease, autonomy, and mental well-being. Debit cards have become their go-to, with 68% preferring them (and BNPL options) over credit. There’s greater peace of mind with clarity, and no fine print or surprise interest. That’s also why 90% of Afterpay customers link their debit cards for installment payments—it helps them manage cash flow without added stress.”
Growing Up in a Time of Financial Turbulence
Gen Z came of age during economic chaos—witnessing the aftermath of the Great Recession, watching parents and older millennials wrestle with credit card debt, and now navigating inflation and record-high living costs.
“Gen Z is entering adulthood during a time of economic uncertainty, inflation, and rising living costs,” said Bryan-Podvin. “They’re more cautious and financially aware from seeing past generations struggle with debt and the Great Recession, and are far more skeptical of tools that don’t serve them. Our survey found that 63% of Gen Z have already walked away from credit cards entirely. This isn’t just a shift but a generational reset, making it clear that credit doesn’t align with their reality or their values.”
Credit = Debt, and Gen Z Isn’t Here for It
Here’s the bottom line: Gen Z doesn’t see credit—they see debt.
“For Gen Z, using a credit card can feel like spending money they don’t actually have. In fact, 70% of adults say credit cards give them that exact feeling,” Bryan-Podvin explained. “Credit cards are built to make spending feel easy; however, too easy can be dangerous. One of my financial therapy clients once reframed their credit card as a ‘debt card,’ and suddenly became way more mindful of their habits. That simple mindset shift can be a game changer, and it’s one Gen Z is making in real time.”
As this generation continues to influence market trends, financial institutions may need to adapt to meet their evolving preferences—because when it comes to credit cards, Gen Z isn’t just uninterested. They’re actively opting out.