By Eela Dubey, Founder & CEO, EduFund
The nature of how the younger generation thinks about education in the current era, has been drastically altered. The attitude is unprecedented compared to the times of their parents. Kids these days possess the nature of being well-informed with their career choices, the price tag for the degree, the methods and the profession as a whole. This is not cynicism. It is awareness brought about by necessity.
The outstanding loan balances increased to Rs 1,29,116 crore between April and September 2024, as per a report by RBI. These figures have more than doubled in the same period in 2020. These figures reflect the actual struggle families go through with high inflation prices.
National Sample Survey (NSS) states that a four-year private university degree can range from Rs 30 – 40 lakhs, with private medical and engineering colleges being three times costlier than government colleges. These prices increase more quickly than most family incomes, leaving even well-planned parents struggling to keep up.
In contrast to their parents, Gen Z are provided with unlimited data like college tuition, placement percentages, job outcomes, ROI calculators. There is transparency that has made them wiser and more intentional consumers of education.
India once had one of the world’s highest savings-to-GDP ratios, peaking near 32.8% in 2006–07. It is a demonstration on how financial wisdom was deeply rooted in our culture. The habit of saving first and spending later has diminished due to easier credit access. The rising education costs now are slowly being replaced by strategic borrowing and calculated investment in degrees.
Financial literacy is ingrained in their life. UPI transactions cross 18 billion every month driven mainly by users under 30 years of age. They compare, track, and optimize. The same principle holds for choosing colleges: “What am I paying for? What’s the return?”
The employment market makes them even more guarded. The ILO’s India Employment Report 2024 revealed that unemployment among educated youth (grade 12 and above) was 18.4 percent, well above the world average. Students are aware that a degree no longer ensures jobs, not to speak of security. They scrutinize risk, consider alternatives, and insist on proof. Every loan is a fiscal choice, not a gamble.
Even the advisors themselves have shifted. In the past, career and financial decisions were guided by family elders. Today, Gen Z gets educated on YouTube, Instagram, and online forums. They learn about loan periods, compound interest, and scholarship opportunities from influencers and peers, sometimes more knowledgeable about payment setups than the grownups filling out their paperwork.
Competition only sharpens the anxiety. The IITs offer about 17,700 B.Tech seats for more than 2 lakh aspirants. Over 20 lakh students take NEET-UG for around 1 lakh medical seats, half in costly private colleges. Delhi University gets 26 lakh applications for 70,000 undergraduate seats. Private universities fill the gap, but their rise, from 276 in 2015 to 473 in 2021, has come with heavy price tags.
Families go the extra mile to make it happen. Some mortgage property. Others take out loans more than their yearly income. Debt transforms everything. Graduates with massive loans can’t afford to take risk-taking jobs or low-paying passion work. They opt for security over discovery. Many pick courses for their employability, not passion. ROI has become the new career compass.
There is another cost that rarely makes it to spreadsheets — the psychological one. Rising debt and job insecurity ha ve started to weigh heavily on young students. A study reveals that financial uncertainty and academic stress were among the top triggers for depression and anxiety among college students in India. Research also shows that higher debt levels are directly linked to lower life satisfaction and motivation. For Gen Z, this turns education into a deeply emotional investment, one that demands not just money, but mental resilience. They’re not only asking what they can afford, but what they can endure. And that, too, is shaping how they think about the worth of a degree.
This extends to overseas education too. Over 13 lakh Indian students are studying abroad, up from 9 lakh in 2022. A Delhi parent who took a ₹40 lakh loan for his son’s UK degree calls it an “investment,” but both parent and child now track outcomes with spreadsheets, not sentiment.
What characterizes Gen Z isn’t pessimism — it’s realism. They understand that blind optimism doesn’t buy EMIs. They’re not cynical, but they’re well-informed. They ask for certainty and accountability because the stakes are personal and near.
The government is catching up. The PM-Vidyalakshmi scheme introduced in 2024 provides up to ₹10 lakh loans to deserving students in 860 institutions, to benefit 22 lakh students annually. But the cost-support gap continues to grow. Thus, families continue to doubt the old promise of education. The risk pays for some. For others, the reward seems woefully insufficient. Either way, skepticism has substituted for blind faith. And this uncertainty has societal implications. When education is a luxury, social mobility throttles. The rich can learn at leisure. Middle-class households have to compute every step. Aspirations get filtered through affordability.
Gen Z’s financial awareness is not a trend, they are coming of age in an economy where schooling is both the pass and the penalty. They don’t view degrees as a sure thing to success but as a high-stakes gamble that demands strategy. Older generations may view this prudence as scepticism, but it’s clarity. When tuition costs a small fortune, you don’t leave it up to fate. You question, compare, plan. This shift might reshape education itself. When students start measuring value by outcome, institutions will have to respond with transparency, career support, and genuine quality. The conversation has already changed — from “What do you want to study?” to “What’s the value of what you’re studying?
