By Josh Katzowitz, WCI Content Director
When I think of the generation gap that spans from the Baby Boomers to Generation X and Millennials to Gen Z, one of the biggest changes (aside from people under the age of 30 not knowing about Jason Priestley) is their attitude toward work. Now, a new term called “soft life” or “soft saving” is floating in the online ether, and depending on your viewpoint (and probably how old you are), it’s either incredibly healthy for long-term living or incredibly harmful for building wealth and allowing people to retire early.
The idea of a soft life or soft saving is, as The Independent notes, to embrace “a more easy and enriched life” by “veering away from stress and struggle.” That brief statement right there is one that could rile up the older generations (“Nobody wants to work anymore!” one could say. “. . . Back in my day, we were on call for 36 hours straight, and we LIKED it!”).
The soft life trend seems to have started on social media after the entire world experienced the COVID pandemic and all the anxiety and isolation that came with it. As the world emerged from its long-term quarantine, a large swatch of Millennials and Gen Z workers and investors took a different approach to the way they wanted to live.
In a Prosperity Index Study conducted by Intuit this year, researchers found that Gen Z “is not looking to retire early and may not be planning to retire at all.” For Gen Z (those who were born between 1995-2012), it’s less about saving and investing and more about “personal growth and mental wellbeing in the now” with the idea that “they would rather feel more fulfilled now than save for a future that is unknown.”
Perhaps this shift in mentality around work, boundaries, and personal fulfillment shouldn’t be surprising. As a Gen Xer, here’s how I’ve thought about generational attitudes toward work:
- Greatest Generation: They won a world war, and then they came home and worked hard enough to move to the suburbs and buy that $8,000 house to raise their 2.5 kids.
- Baby Boomers: They work until their fingers fall off and suffer burnout as a result, even though nobody knew what burnout was.
- Gen X: A hybrid of hustle culture and the anti-work subreddit. As we get older, a soft life sounds more appealing.
- Millennials: More into boundary setting and doing what’s right for them as individuals as opposed to company goals. That’s not a judgment statement, by the way.
- Gen Z: Less concerned with their future. Not at all concerned with those who employ them.
Of course, those descriptions are huge generalizations, and clearly not everybody will fit into those bullet points. My biggest question, though, is this: Is soft living and soft saving a healthy way to live, or will it simply end where the generations that engage in them can never afford to retire?
What Does Soft Living Mean for Millennials and Gen Zers?
Perhaps soft living and soft saving isn’t a financially savvy decision, particularly for young doctors who have large student loans. But for burnout prevention, setting boundaries between work and the rest of your life and allowing yourself some self-care in the form of a nice vacation or an expensive dinner might be a mentally healthier way to live.
“This is the first I’ve heard of the term ‘soft saving,’ but I don’t disagree with its premise,” Danny, a second-year resident who is part of the WCI series From Fourth Year to the Real World and who is married to another resident physician named Ariel, told me. “We definitely live this way, but I think we view it differently at this point in our lives. The income of a resident is finite, but our youthful years are also the same. Viewing it from a resident’s perspective, we know that we will have much higher earning and saving capacity in attendinghood, and we (more so me, but still true for Ariel) are OK saving minimally.”
Danny and Ariel make a combined $126,000, and over the course of their first two years in the real world, they’ve each accumulated $6,000 in retirement with individual emergency funds of at least $10,000-$15,000 (for now, the married couple keeps separate financial accounts).
The young millennial couple feels good about their savings, and they prioritize living comfortably. Yes, they have about $400,000 in student loans, but Ariel has a season pass to one of the country’s top-notch amusement parks and Danny bought season tickets to the local major college football program. They’re not necessarily skimping.
“In a different branch of the multiverse where we were not expecting to have our income [increase] 3x-4x in the next couple of years, I believe we would absolutely be living differently by tucking money away more aggressively and doing some things differently,” Danny said.
In the Intuit survey, more than half of Gen Z respondents said they have lied about how much money they earn or how much debt they owe. Though this trend might have started on social media (just look at the #softlife hashtag on TikTok that has more than 1.2 billion views), it’s clear that social media also contributes to feelings of inadequacy by its users.
Soft living, then, isn’t only about eschewing your savings goals or not maxing out your retirement accounts so you can travel to Europe on a last-minute deal or spend hundreds of dollars on a price-fixed meal. It’s about living life the way you desire while maintaining your work-life boundaries. It's about feeling adequate in your life.
More information here:
How Does Soft Living and Soft Saving Affect a Young Doctor’s Finances?
More spending and less saving means that young investors who engage in soft living and soft saving can’t build large amounts of wealth. But there has to be a feeling of freedom if you’re not living like a resident and indulging when you can.
“Financial advisor hat on: compounding interest is vital ASAP. Human hat on: good for Gen Z,” Chad Chubb of WCI-recommended WealthKeel told me. “A lot of us could probably use a little bit of this in our lives for better work-life balance. I don’t think I would take it as far as [some are willing to do], but some of this is good. Let’s also be honest with each other: I surely was not making my best money decisions between the ages of 18-25 either.”
Like Danny, Chubb wasn’t familiar with the terms of soft living or soft savings before I emailed him (in fact, I talked to a number of millennials about this topic, and barely anyone had heard of them either). Considering Chubb’s company only works with physicians, it seems like young doctors who are financially literate or trying to become so aren’t truly engaging in these lifestyles. At least not yet.
“We do work closely with our clients to try to find the right mix of live now vs. retirement planning, so in a way, we welcome this,” Chubb said. “But I also need to ensure we are on the same page for the longer term.”
Among Danny’s friends and colleagues, he doesn’t know of anyone who has an aggressive savings plan.
“More frequently,” he said, “I hear other residents tell me about how poor of savers they are, so I believe most other residents are in the same situation as us—probably trying to tuck some money away for an emergency but are going to wait for attendinghood when the salary will 2x-4x to really make a dent in the long-term retirement plan.”
Older generations might believe that soft living and soft saving are terrible ideas for future finances. But I thought this passage from The Everygirl was interesting. Soft living is not an idea based on laziness, ignorance, or apathy. There is a thought process here.
Wrote author Katherine Chang: “It’s not about scaling back on your career efforts like quiet quitting–it’s about prioritizing your joy first, which can mean quitting a toxic job or leaning into the aspects of your job you genuinely love. It’s not anti-work; it just means setting boundaries where you need (work, relationships, housework, etc.) so you feel less stress and more joy in your life overall. Soft living can look opulent, but at its core, it’s a mindset cultivating balance, self-awareness, intentionality, and joy.”
Still, it's going to be tough, if not impossible, to build enough wealth to retire comfortably, especially if you have thoughts of FIRE.
More information here:
How Does Soft Living Relate to FIRE (or Retirement in General)?
One of the main takeaways from the Intuit study is that “soft saving is Gen Z’s response to FIRE (and) hustle culture.” Two in three Gen Z respondents actually said they don’t know if they’ll ever have enough money to retire.
Said Danny: “Part of the psychological pushback against FIRE may have more to do with young people weighing their average current salaries against the increased average cost of living compared to previous generations, higher than average mortgage rates for homes that are way overvalued, and not seeing a path to actually obtain FIRE so then viewing it as unrealistic, and subsequently psychologically telling yourself you didn’t want to do that anyways.”
Maybe, if you’re looking for a soft life, it should be a temporary strategy—not one that lasts for years. Just because you take some time off from what WCI traditionally recommends (living below your means to pay off student loans, saving 20% of your income, building an emergency fund, investing as aggressively as your risk tolerance allows, etc.), that doesn’t mean you’ve doomed yourself to a life of working forever.
Even if you take a breather from the grind and live a soft life for a while, you can still retire (and perhaps even FIRE).
“Yes, 100%,” Chubb said. “Do we miss out a little on the compounding interest part early on? Sure. Not to say student loans are going anywhere anytime soon, but physicians are a group that are already used to a delayed start—whether that is from training; student loans; or, unfortunately, both.”
For now, it seems that soft living exists mostly on social media channels, and most physicians who are considered Gen Z still haven’t reached attendinghood yet. But it’ll be interesting to see if other high earners follow the path set by a millennial lawyer named Tay Ladd who told Moneywise that she was once involved in the so-called hustle culture before she began suffering physical ailments from her lifestyle.
So, she changed her life.
As Moneywise writes:
“While she hasn’t left her high-pressure job, she reevaluated how she schedules her days and set firm boundaries to carve out time for herself and the things she enjoys. Now, she makes her mornings all about herself: a skin care routine, breakfast, Pilates class. She won’t schedule calls during her personal time, and she splurges on things that make her feel good, like working out or vegan meal subscriptions.
And then, when she’s at work, she’s able to give it her full attention.”
She also makes this important distinction about her future.
“I don't see myself retiring at all . . .” she said. “I’m not working to retire.”
Money Song of the Week
Drivin’ N’ Cryin’ was one of my favorite bands as a kid. It probably helped that the lead singer and guitarist, Kevn (not a typo!) Kinney, was a fixture in the Atlanta music scene, and he went to a rival high school in the suburbs (ahem, many years before I did). I loved the band’s music, which was a combination of Southern rock and up-tempo folk music with lyrics that seemed to fall out of the mouth of a blue-collar kid trying to make it in the cold, hard world.
(An aside: I once met Kinney on the side of the stage of a Twilight Singers show at the late, great Masquerade concert venue in Atlanta. I told him I was a big fan. He said, “Thanks, brother.” It gave me chills.)
DNC was more of a regional band (though “Fly Me Courageous” was a modest hit in 1991), and the last time I saw Kinney and company live, it was in the parking lot behind an art store with about 50 other people at a South By Southwest showcase in Austin a few years ago. It was awesome.
Anyway, today’s song is DNC’s “Scarred But Smarter,” which was released on the band’s first album in 1986 and which comments on how unfair life can be but that there’s always a chance to find the correct path again.
Yes, the protagonist in this song seems full of despair, especially when Kinney sings.
“Is it right to wish the poor man rich/Is it right to wish the rich man poor/To hope all that's well is fair ends fair/To wish thy neighbor's life to despair.
Being so mad that I start crying/No pay off for all my trying/To do it right—to never fail/Wishing for a fairy tale.”
But there is hope in the song. As Kinney told AL.com in 2014, the song was about how “nobody said it would be fair before you went out there, but there's always a chance to get started again with a new life.”
Tweet of the Week
It’s one thing to accumulate enough wealth to retire. It’s another thing entirely to let some of that wealth go.
— 𝔾𝕨𝕖𝕟 𝕄𝕠𝕣𝕚𝕥𝕫 (@gwenmoritz) August 26, 2023
What do you think about soft living or soft saving? Could you imagine yourself engaging in those practices? If you did, could you comfortably retire? Comment below![Editor's Note: For comments, complaints, suggestions, or plaudits, email Josh Katzowitz at [email protected].]