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October 24, 2023 at 11:20 AM
Generation Z participants in recent research by Charles Schwab said they would like to retire at age 61, but virtually all reported that they are having trouble saving for a comfortable retirement. They, more than their older peers, also said they need professional advice to overcome obstacles to saving.
Fifty-four percent of the youngest members of the workforce said inflation was their main obstacle, followed by 35% who said keeping up with monthly expenses and 31% paying for unexpected expenses.
A quarter of Gen Zers and a fifth of millennials in the survey said financial stress has affected their ability to do their job, a concern for 15% of Gen Xers and only 10% of baby boomers.
Logica Research conducted the online survey between April 19 and May 2 among 1,000 U.S. respondents who were actively employed by companies with at least 25 employees, were 401(k) plan participants and were between 21 and 70 years old. Survey respondents include participants served by approximately 15 different retirement plan providers. In order to analyze Gen Z results against other generations, an additional 100 plan participants aged 21 to 26 completed the survey.
The Advice Generation
More than any other generation in the survey, Gen Z workers think their financial situation warrants advice from a professional. Ninety-eight percent reported that they are currently seeking financial advice from at least one source, compared with 81% of millennials, 82% of Gen Xers and 85% of boomers.
More than half of the youngest workers are asking family and friends for advice. They are also accessing advice through their 401(k) plan provider, employer, financial advisor and social media.
The survey also found 75% of Gen Zers and 66% of millennials are comfortable asking AI tools for help with financial planning, but adoption is still very low across all generations. The two younger cohorts are likelier than older workers to follow recommendations from a human financial professional than a computer, but are more open to both types of advice overall than their older peers.
See the gallery for the top 10 areas survey participants in which Gen Zers said they needed help with retirement planning and how their needs compare to those of older generations, according to Schwab’s research.
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