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Ramadan 2023: Gen Z Choose to Save THR, for Financial Freedom?

It is undeniable that spending in Ramadan 2023 tends to be bigger, such as for holiday needs and religious donations. On the one hand, workers also get a Holiday Allowance (THR).

Jakpat conducted a survey to find out expenses in Ramadan. The report, which involved 1255 Muslim respondents, shows the needs of Ramadan, including the use of THR and zakat payments. Respondents were split between 33% of Gen Z, 49% of Millennials, and 18% of Gen X.

Ramadan 2023 expenses

In general, spending in Ramadan 2023 is related to the moment. Zakat/infaq/shadaqah is in the first position with a percentage of 86%. Other needs of respondents are Ramadan shopping such as clothes, accessories, or worship equipment as much as 74% and food shopping for Ramadan and Eid al-Fitr 73%. Eidi (cash gift), homecoming, and Eid al-Fitr hampers were also included in the calculation of Ramadan expenses this year.

As many as 70% of respondents used their monthly salary for Ramadan 2023 expenses. Other sources were 63% THR and 53% savings. More specifically, Gen Z relied on THR (63%) and savings (61%) as a source of funds for Ramadan 2023 expenses. Two other generations, Millennials and Gen Xers, used salary as their primary source, with a significant gap between THR and savings.

What were THR for?

Jakpat respondents used THR for various things, in addition to shopping for Eid clothes (48%) and zakat/infaq/shadaqah (42%). Some saved the money (41%) and used it for daily needs (35%).

Some respondents used THR to share, such as giving it to loved ones (32%), Eid cash gift (29%), and giving Ramadan hampers (25%).

As many as 53% of Gen Z chose to save THR. Meanwhile, half of Millennials and Gen X spent THR by shopping for Eid clothes and paying zakat/infaq/shadaqah.

“In general, people use THR to meet their needs during Eid, starting from Eid clothes, transportation costs and homecoming accommodation, Eidi cash gift, holidays, celebrations and food. It’s just that there is a different trend among Gen Z, where more than 50% chose to save it. It could be because they are still young and there are no demands to meet the needs of Eid events in their families, or they have certain goals,” said Head of Research Jakpat, Aska Primardi.

“We see that the reason Gen Z saves is to quickly achieve financial freedom. It can be seen that the number of Gen Z who allocate THR to buy investment products is more than Gen X and Gen Y. In addition, Gen Z savings are also planned to buy tickets for various events throughout 2023, one of which is music concerts from international musicians,” he continued.

Paying zakat offline is more convincing

As many as 90% of Jakpat respondents chose to pay zakat directly, either by distributing it to the amil zakat agency in the mosque/neighborhood or giving it directly to those who are entitled to receive the religious donation. The reason is that they felt more confident in the contract (72%) and more practical in the process of giving (56%).

Meanwhile, respondents who chose to pay zakat online were divided in three ways. First, distributed it to online zakat agencies via official websites such as Baznas, Dompet Dhuafa, or Rumah Zakat (5%), then paid through the Gopay, LinkAja, or OVO e-wallet or e-commerce applications (4%). The last one, they chose to pay Zakat through mobile banking  applications such as BCA Mobile, Livin by Mandiri, or Jenius.

Ramadan 2023 edition ads

Ramadan edition ads also enliven the nuance of the holy month, 64% of Jakpat respondents claimed to enjoy this commercial. Four out of 5 of these respondents watched the ad on TV. Followed by YouTube (59%) and social media such as Instagram, Facebook, or TikTok (57%).

Digital Ramadan advertising exposure dominated all generations. After TV, Gen Z admitted to seeing such ads on social media more often (64%) than YouTube (58%). Meanwhile, Gen X (28%) admitted to seeing more Ramadan ads on websites such as online  news than Gen Z (21%) and Millennials (24%).