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New Study Suggests Gen Zers Could End Up Richer in Retirement Than Boomers

By Adam Hardy MONEY RESEARCH COLLECTIVE

Gen Z is starting retirement savings earlier than boomers, giving compound growth decades longer to work.

Money; illustration AI-generated with Gemini

Despite being early in their careers, Gen Zers are doing surprisingly well already when it comes to saving for retirement.

Compared to older generations, Gen Z workers are starting to build their nest eggs much sooner, according to an annual Bank of America survey released Tuesday.

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“The youngest generation in the workforce is starting to save for retirement a full decade earlier than their older peers,” Kai Walker, managing director of workplace benefits research at Bank of America, said in the report.

The study found Gen Zers — whom it defines as anyone born after 2000 — are beginning to save in a 401(k) at an average age of 24, compared to baby boomers who started at 34.

Similarly, Gen Zers are outpacing boomers in terms of how prepared they currently feel about retirement as well, with 84% of Gen Z reporting they are confident that they’re on track for retirement, versus 79% of boomers who said the same.

The results are based on a survey of 941 full-time U.S. workers who participate in 401(k) plans and 806 employers who offer 401(k) plans.

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Saving for retirement? Sooner is better

When should you start saving for retirement? The Bank of America survey suggests that Gen Zers have the right idea: right now. Separate research shows that sooner is almost always better when it comes to building up meaningful savings for retirement.

The key is compound growth — that’s the long-term effect of what happens when you save and invest your money over long periods of time. Your earnings start making earnings.

Saving early isn’t the only factor, however. A recent J.P. Morgan analysis demonstrated how you save is just as important by simulating account balances of various saving and investing strategies of people between the ages of 25 and 65 based on a $250-a-month contribution.

For instance, a consistent saver earning an average return of 3.1% by keeping the money in a savings account for 40 years had a retirement account balance of $238,600. While the saver started early, they missed out on huge gains by not investing those funds.

By investing the money and earning 7.25% returns, the account balance after 40 years based on the same $250 monthly contribution could have reached $685,200.

The analysis also factored in a scenario in which the saver invested $250 a month from the age of 25 to 35 and let the money grow without additional contributions for 30 more years. By the time the saver reached the age of 65, the account balance for this strategy — $367,300 — dwarfed that of the consistent saver who didn’t invest.

Thanks to auto-enrollment features gaining traction in workplace retirement plans, younger workers are increasingly getting access to employer-sponsored retirement accounts, and their contributions are being invested. According to the Federal Reserve, 29% of workers aged 18 to 24 now have a retirement account, up from 26% the previous year.

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Adam Hardy

Adam Hardy is Money's lead data journalist. He writes news and feature stories aimed at helping everyday people manage their finances. He joined Money full-time in 2021 but has covered personal finance and economic topics since 2018. Previously, he worked for Forbes Advisor, The Penny Hoarder and Creative Loafing. In addition to those outlets, Adam’s work has been featured in a variety of local, national and international publications, including the Asia Times, Business Insider, Las Vegas Review-Journal, Yahoo! Finance, Nasdaq and several others. Adam graduated with a bachelor’s degree from the University of South Florida, where he studied magazine journalism and sociology. As a first-generation college graduate from a low-income, single-parent household, Adam understands firsthand the financial barriers that plague low-income Americans. His reporting aims to illuminate these issues. Since joining Money, Adam has already written over 500 articles, including a cover story on financial surveillance, a profile of Director Rohit Chopra of the Consumer Financial Protection Bureau and an investigation into flexible spending accounts, which found that workers forfeit billions of dollars annually through the workplace plans. He has also led data analysis on several of Money’s marquee rankings, including Best Hospitals, Best Credit Cards, Best Places to Live and others. In 2025, Adam was named a Goldschmidt Data Journalism Fellow by the Society for Advancing Business Editing and Writing (SABEW). As part of the fellowship, he received hands-on training from SABEW, the U.S. Census, U.S. Federal Reserve Bank, Bureau of Labor Statistics and other federal government agencies in Washington, D.C. Adam also holds a multimedia storytelling certificate from Poynter’s News University and a data journalism certificate from the Investigative Reporters and Editors at the University of Missouri. In 2017, he received an English teaching certification from the University of Cambridge, which he utilized during his time in Seoul, South Korea. There, he taught students of all ages, from 5 to 65, and worked with North Korean refugees who were resettling in the area. Now, Adam lives in St. Petersburg, Florida, with his pup Bambi. He is a card-carrying shuffleboard club member.