Gen Z is Embracing Retirement Readiness

With the groundwork laid by previous generations, today's youth are embracing the concept of early retirement planning by leveraging investment funds, prioritizing their financial security from an early age.

The landscape of retirement planning has significantly evolved, with the invention of 401(k)s and other defined contribution (DC) retirement plans offering automatic enrollment and diverse investment options. Younger workers are making huge strides in retirement saving, surpassing the average milestones of previous generations.

In fact, Gen Z savers hold nearly three times the assets in their DC plan accounts compared to Gen X savers at the same age. And nearly a quarter of all Gen Z have a retirement plan, compared to just 7 percent of people their age in 1989.

This is great news because the earlier and longer you invest in these plans, on average the larger the return when you’re ready to retire! For example, data shows that people in their sixties who participated in their plan for 2 years had an average of $46,457, while someone who participated in their plan for more than 30 years had an average of $306,214.

The data is clear: young professionals are capitalizing on their employer-sponsored retirement plans, not only putting them on the path to saving but also introducing them to investing!

And that introduction is benefiting their financial futures! Seven in ten households under the age of 35 that own mutual funds in 2023 actually purchased their first mutual fund through their employer-sponsored retirement plan. These workplace initiatives foster financial literacy and investment among young adults! 

Of course, it’s not just the workplace benefits that have inspired saving among Gen Z. The emphasis on early and consistent saving from older generations have reinforced the retirement preparedness of Gen Z and Millennials. They see their grandparents and parents saving, and it’s instilled in them a mindset necessary for long-term financial security.

Secure Financial Future invites you to join our action network and help continue to pave the way for future generations! We’ve already made big strides this year, and our work is just getting started. You’ve worked hard for your retirement. 

Now it’s time to commit to fighting for those just getting started.  Together, let's champion policies that safeguard investments and pave the way for a new era of financial security for the next generation.