AI has become a utility bill for Gen Z

For many Gen Z users, paid AI tools are becoming a regular household expense because they help with work and daily tasks. Kyle Largo, a 28-year-old in Dumaguete, spends about $248 a month on Claude, ChatGPT, ElevenLabs and Grok, plus roughly $100 a year for Gemini. He uses the tools to produce video ads for U.S. health brands, cutting work that might take one or two hours down to a fraction of that time. He also relies on AI to budget, plan travel, choose outfits, organize workouts and support his mental health. Largo sees the subscriptions as an investment that helped him build a sustainable income, and says he would cancel entertainment services before AI.

The wider spending trend points in the same direction: Gen Z subscription spending rose nearly 14% year over year in July 2026, while spending on “reading and information,” a category that includes AI services, increased 61%. Financial adviser Ryan Marshall says paid AI can be worthwhile for entrepreneurs who use it to increase productivity and delay hiring, but recommends trying free options first. For personal use, he considers spending more than $20 a month excessive. The central test is whether a subscription produces clear value through saved time, better performance or career growth. Users should also track recurring charges and prioritize emergency savings, retirement contributions and other essential expenses before paying for discretionary tools.