The study by BlackRock found that Gen Z workers are saving about 14% for retirement compared to the 12% Gen X and baby boomers are saving.
Anne Ackerley, head of BlackRock’s retirement group, said there are two things that might factor into Gen Z’s higher rate of savings. One is that they were more likely to be raised in households where no one counted on a traditional pension.
“I think it’s a reflection that we’ve switched to defined contribution plans from defined benefit plans,” Ackerley said. “Gen Z was raised in households where there was a need to save for retirement … and the message is out there that you’re on your own, that you need to start saving early,” she said.
Another reason is that they may have watched the family struggle due to the 2007-2009 recession and want to avoid similar challenges.
Additionally, the younger generation envision retiring earlier, at 63.6 compared to working boomers, who envision retiring at 65.9.