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Gen Z Is Banking More on Retirement Than Older Generations

This is how much the newest workforce participants are stashing away -- and why.


With inflation and the possibility of a recession on everyone's mind, many are eager to safeguard their personal finances, especially retirement accounts.

It turns out that Generation Z workers are taking those retirement savings particularly seriously — more so even than older generations, including millennials, Gen Xers, and baby boomers, per new research from BlackRock, and there are likely several contributing factors.

Related: 6 Reasons to Pursue Entrepreneurship in Retirement

According to NerdWallet, experts generally suggest workers save between 10% to 15% of their pre-tax income for retirement; high earners should aim for the top of that range while low earners, who may count on social security to replace more of their income, usually save less.

The BlackRock study found that Gen Z workers (ages 18-25) are saving near the upper part of that range, on average — at 14% — while millennials (ages 26-42), Gen Xers (ages 43-55), and baby boomers (ages 56-75) save an average of 12%.

Additionally, Blackrock's research revealed that the total share of Americans who believe they're on the right track for retirement has dipped to 63% from 68% in 2021, with plan sponsors also losing faith: 58% believe their employees are on the right path, compared to 63% last year.

Anne Ackerley, head of Blackrock's retirement group, tells CNBC Gen Z might be more cautious because they were more likely to grow up in a household where no one was depending on a traditional pension, instilling a "you're on your own" message, and because they may have witnessed family members struggle during the 2007-2009 recession.

Related: 4 Ways to Save for Retirement Without a 401(k)

Additionally, researcher Jason Dorsey told Yahoo Finance that Gen Z workers were most likely to lose their jobs during the pandemic, "which changed how they view work going forward, how they view savings, retirement, and so forth. The fragility of employment became very, very real to them."

If Gen Z workers do stay on track, they may actually be able to retire one day, Dorsey says, though the same can't be said for many millennials.

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