Some Americans are embracing 'financial nihilism' for big returns — here's what it means
As people are living paycheck-to-paycheck and rising costs are eating into savings, the advice on savings doesn't seem to be helping Americans. Saving and investing as much as possible was considered common sense, but that formula now feels increasingly useless as everyday expenses are climbing and homeownership is slipping further out of reach in many cities. A growing number of Americans say they relate to what Northwestern Mutual calls “financial nihilism.”
In a recent survey of more than 4,300 adults, nearly three-quarters of respondents who feel financially behind said they identify with that outlook. The term describes a belief that conventional investing strategies may not be enough to catch up, and so some are taking financial risks.
Under the influence of “financial nihilism,” Americans who feel the traditional rules of saving and investing are no longer working are turning away from the old playbook and taking bigger risks instead. Cryptocurrency, sports-style wagering and event-based contracts on prediction markets are among the avenues gaining attention. The thinking, according to the survey, is straightforward. If the traditional path feels too slow or out of reach, a high-risk play might offer a shot at a life-changing payoff.
“When people feel behind, they often look for shortcuts,” said John Roberts, the Northwestern Mutual’s chief field officer. “But building financial security is rarely about cutting corners,” Roberts said. “It’s about consistency, discipline and protection. A comprehensive plan helps people grow confidently without taking unnecessary risks,” he added. Roberts further mentioned that speculative assets can have a place in a portfolio, but only in moderation. “These high-risk assets can be fun to play with,” he said, before adding, “but that’s why we recommend only spending ‘fun money’ on them. Don’t allocate more than you can afford to lose completely.”
The appetite for speculation appears strongest among younger adults. Gen Z and millennials make up the largest share of Americans who say they are investing in or considering investing in high-risk assets. The survey suggests another financial blind spot is emerging. More than half of Americans, about 52%, say they focus heavily on growing their wealth but devote less attention to protecting what they already have or managing risk. That imbalance appears even stronger among younger investors. About 57% of Gen Z respondents and 62% of millennials acknowledged the same gap in their planning.
On the Reddit forum r/economics, where users often debate economic trends, some commenters argue that modern finance increasingly resembles a game. “Everything is gamified now,” one user wrote in response to the survey findings. “For someone who grew up with dopamine-optimized apps and game-like products around personal finance, why would they think any differently?” Another commenter pointed to a deeper frustration. For younger workers facing high housing costs and stagnant wages, the downside of risky bets can feel less frightening than the status quo. "If you’re 20 and working a dead-end job,” the user wrote, before adding, “losing big trading on an app might only mean you can’t buy a house for a few years. But a lot of people already feel like they can’t buy one anyway.”
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