Urgent wake-up call: 60% of Gen Z, millennials have less than $5K in retirement savings (2024)

FAQs

How much does the average Gen Z person have saved for retirement? ›

Median retirement savings for Gen Z is $29,000, according to a new retirement survey by Goldman Sachs Asset Management. The research shows 68% of survey respondents believe their savings are on track or ahead of schedule.

sort of. At age 62, with $400,000 in a 401(k) account, you can generate a livable income depending on how you structure your portfolio and where you choose to live. Livable does not mean comfortable, however.

The fraction of millennials with at least $100,000 in retirement is significantly less than the portion of millennials who have no retirement savings. 42.2% of millennials have no retirement savings while only 10.6% of millennials have at least $100,000 or more. 8.

As we have established, retiring on $500k is entirely feasible. With the addition of Social Security benefits, this becomes even more of a possibility. In retirement, Social Security benefits can provide an additional $1,900 per month, on average. You can start receiving Social Security benefits as early as 62.

Younger generations the least prepared

"Gen Z and millennials are notably behind, with over three in five (60%) either having no savings for retirement or having saved less than $5,000. But 17% have saved between $5,000 and $50,000."

In an analysis of its 23.3 million 401(k) participants at the end of the first quarter, Fidelity said Thursday that the average balance for Gen Z increased 15% from the fourth quarter to $11,300, compared to an 11% increase to $59,800 for millennials. Across all generations, the average balance rose 6% to $125,900.

How many Americans have $100,000 in savings? About 26% of U.S. households had more than $100,000 in savings in retirement accounts as of 2022, according to USAFacts, a nonprofit organization that analyzes data from the Federal Reserve and other government agencies.

For many people, financial stability means being confident in your ability to pay for all the expenses in your life — whether expected or not. There's no one-size-fits-all number in your bank or investment account that means you've achieved this stability, but $100,000 is a good amount to aim for.

When Millennials Make the 1% Mark — For Their Age Group. Consider that millennials are toward the younger end of earners, which plays a role in where they fall on the net worth continuum. “They hit the top 25% at around $50,000 and the top 1% at about $175,000,” Jennings said.

To retire with at least $1 million by age 62, the amount you'll need to save each month will depend largely on how many years you have left to save. The earlier you get started, the easier it will be to build a robust nest egg. Even if you're off to a late start, though, that doesn't mean all hope is lost.

Can I retire on $500,000 plus Social Security? ›

The short answer is yes, $500,000 is enough for many retirees. The question is how that will work out for you. With an income source like Social Security, modes spending, and a bit of good luck, this is feasible. And when two people in your household get Social Security or pension income, it's even easier.

$700k can last you for at least 25 years in retirement if your annual spending remains around $40,000, following the 4% rule.

Generation Z's Savings Account Balances

Although Gen Z is the least likely of any generation to have $100 or less in a savings account, Gen Zers are still likely to have relatively low savings overall — 56% of Gen Z has $1,000 or less in savings.

According to the Federal Reserve, individuals under the age of 35 have a median net worth of around $39,000. While this figure includes a few younger millennials, this reflects mostly Gen Z adults.

What Is The National Average For Retirement Savings? The national average for retirement savings varies depending on age, but according to the Economic Policy Institute, the median retirement savings for all working age households in the US is around $95,776.

This young generation also has expectations for funding retirement that is "aggressive," Ceder said. Almost half (44%) said they expect to retire before age 60, and three-quarters intend to retire with less than 70% of their pre-retirement income, the study found.