The financial landscape is undergoing a major shift, with younger generations redefining investment strategies. In the podcast Is Gen Z Killing Traditional Investment? host Bhagyashree Bhansali speaks with Anuj Singhal, Managing Editor of CNBC Awaaz, and Sayali, Founder of FinCocktail, to explore whether Gen Z is moving away from traditional investments like Fixed Deposits (FDs) in favor of riskier, high-return options. Their conversation sheds light on how financial literacy, risk appetite, and digital influence are reshaping wealth creation for the future.

Here are the five key takeaways from the discussion:

1. The Decline of Fixed Deposits: Why They Are No Longer the Go-To Investment

Fixed deposits have long been considered a safe and reliable way to grow savings, but they are no longer as attractive as they once were.

Sayali attributes this shift to evolving financial literacy and broader investment options. She explains that in the early 90s, after India’s economic liberalization in 1991, people had limited financial knowledge and fewer investment choices. FDs were a simple and safe option at the time. However, with growing awareness about mutual funds, stocks, and alternative investments, people are moving beyond traditional savings methods.

Anuj highlights another key issue: taxation. “With FDs, you receive interest later but pay taxes in advance,” he points out. This makes them less efficient than other investment instruments. Additionally, the COVID-19 pandemic played a significant role in changing people’s financial perspectives. The economic uncertainty led many to explore stock markets and alternative investments, accelerating the shift away from FDs.

Takeaway: Fixed deposits are no longer the primary choice for wealth accumulation due to low returns, taxation policies, and the availability of more lucrative investment options.

2. Gen Z’s Changing Relationship with Money: From Stability to Risk-Taking

Investment strategies have evolved across generations. Sayali notes that while her grandparents valued government jobs for stability, her parents took a leap into private-sector employment, and she transitioned from a stable job into entrepreneurship. This generational shift reflects a broader trend of embracing financial risks for greater independence and potential rewards.

Anuj shares a personal insight, comparing his upbringing with how he is raising his daughters. “My father told me he would support me only until I finished my education. But I’ve told my daughters, ‘Do whatever you want, I am here for you.” This change in mindset reflects the increased financial security that Gen Z enjoys compared to previous generations.

However, Anuj also believes that financial security can sometimes lead to complacency. “We grew up with a scarcity mindset, but today’s kids don’t have that experience,” he says. While financial independence is empowering, it can also lead to a lack of discipline in money management.

Takeaway: Unlike previous generations that prioritized job security and savings, Gen Z embraces riskier investments, financial freedom, and entrepreneurial ventures. However, the challenge lies in balancing independence with financial discipline.

3. The Rise of Alternative Investments: Where is Gen Z Putting Their Money?

With fixed deposits losing appeal, younger investors are turning to alternative investment options. When asked about current investment trends, Anuj highlights equities, cryptocurrency, and commodity trading as the most popular choices. He observes that cryptocurrency is gaining traction, heavily influenced by trends in the American market.

While these options offer potentially higher returns, they also carry greater risks. Social media plays a significant role in driving investment decisions, with financial influencers frequently promoting high-risk investments. Sayali acknowledges the importance of financial education but warns that many young investors jump into markets without fully understanding the risks involved.

Despite regulatory efforts from SEBI to monitor financial influencers, misinformation continues to spread. Bhagyashree questions the effectiveness of these regulations, and Sayali points out that compliance remains a challenge. “Yes, SEBI is introducing rules, but how many influencers are actually following them? And are people consuming content from credible sources or just engaging with viral content?”

Takeaway: Gen Z is shifting towards riskier investments like equities and cryptocurrency, driven by social media influence. However, financial education and regulation are essential to prevent reckless decision-making.

4. The Influence of Social Media on Financial Decisions

Social media has transformed financial education, making investment knowledge more accessible than ever. However, it has also created an environment where misinformation spreads rapidly. Many young investors rely on influencers rather than traditional financial advisors, often leading to impulsive investment decisions.

Anuj acknowledges this trend but clarifies that traditional media does not cater to very young audiences. “Just because they are a larger audience doesn’t mean I create content for them,” he says. This leaves a gap in credible financial information for teenagers and young adults, who often turn to viral content instead.

Regulatory bodies like SEBI are attempting to control the financial influencer space by introducing guidelines for registration and compliance. However, enforcement remains a challenge. Sayali emphasizes that audience behavior plays a crucial role—people are more likely to engage with visually appealing, entertaining content rather than well-researched financial advice.

Takeaway: While social media has democratized financial knowledge, it has also made misinformation more prevalent. Young investors must verify sources before making financial decisions.

5. Smart Money Habits: Practical Strategies for Gen Z Investors

Despite changing investment trends, fundamental financial principles remain the same. Anuj stresses the importance of early investing and asset-building. He strongly advises buying property as a long-term investment. “If you want to build an asset, buy a house. I feel financially secure because I bought a house long ago,” he says.

Sayali also suggests the 30-day rule to avoid impulse spending. “If you see an ad and want to buy something, add it to your cart but don’t purchase it immediately. Wait 30 days. If you still want it, then buy it. If you forget about it, you never needed it.”

A Gen Z participant in the podcast expressed confusion about where to invest his first salary. Anuj simplified it: “Maximise your EPF and PPF first. These are tax-efficient and give good returns. Once you’ve secured those, then go full equity. By the time you’re 15-20 years into a job, you’ll realise the power of starting early.”

Takeaway: Gen Z should focus on tax-efficient investments, real estate, and disciplined spending to build long-term financial security. Early investing and strategic savings can create financial stability in the long run.

Is Gen Z Killing Traditional Investment?

Gen Z is not killing traditional investment—they are redefining it. While fixed deposits and low-risk savings methods are declining in popularity, young investors are exploring high-risk, high-reward alternatives. However, with financial freedom comes the responsibility of making informed choices.

Misinformation from social media influencers, lack of financial discipline, and regulatory challenges can lead to poor investment decisions. Therefore, balancing financial literacy, risk assessment, and long-term planning is essential.

Ultimately, the golden rule of investing remains the same: Start early, invest smartly, and diversify wisely.

If you haven’t yet, watch the full episode on YouTube