There is no generation that is immune to anxiety after retirement. For post-millennials, retirement concerns include outliving beyond money, high inflation, and a lack of Social Security.
The good news is that even the oldest Gen Zers have decades of savings before they quit their 9-to-5 jobs.
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Here are the top four concerns Gen Z has about retirement and how to overcome them.
Current trends:
One of the most common concerns of all generations, including Gen Z, is running out of money.
According to BlackRock’s 2024 Read on Retirement report, 69% of Gen Z respondents say they are worried about being able to use their retirement savings. The good news is that 77% feel they are on track to retire on their terms.
The younger generation is confident, and for good reason. According to Northwestern Mutual’s 2024 Planning and Progress Study, Gen Zers started saving for retirement at age 22, nearly a decade before the average person started saving at age 31. .
As the study reports, many zoomers expect that starting early will lead to early retirement. It’s also a good idea considering Gen Z expects to need more than $1.6 million to retire comfortably.
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Another concern Gen Z faces is rising inflation. This generation came of age during economically difficult times.
Facing near-record inflation, Gen Z is struggling to build wealth. Although Gen Z has significantly less student loan debt than Millennials and Gen X, they are not debt-free.
This generation had lower incomes than previous generations and had to deal with exorbitant food prices and a tough housing market. Most of their income goes toward rent, utilities, and other necessities, rather than savings.
Despite these hurdles, Gen Z is still saving money. They understand the power of compound interest and are not afraid to make the most of their retirement savings.
Even without some of the advantages that other generations had, such as pensions and ease of entry into the workforce, Zoomers are forging their own path with focus.
Gen Z is also concerned about access to Social Security.
According to a Social Security survey conducted by Harris Poll on behalf of Nationwide, nearly half (45%) of Gen Zers believe they will never receive the Social Security benefits they have earned. Additionally, 76% of Gen Z respondents believe they will need to work long after they retire because Social Security doesn’t pay them enough.
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On the bright side, Gen Z refuses to sit idly by. Rather, this generation is eager to get the support they need to make smart money decisions.
The survey found that 43% of Zoomers “plan to ask a financial professional about their Social Security benefits.” This is significantly higher than previous generations, including just 22% of Gen Xers and just 6% of baby boomers.
The final obstacle many Gen Zers face and worry about their future is the ability to purchase real estate. Homeownership is often the key to retirement.
Many people use their home as part of their retirement planning, invest in it, and pay off their mortgage, making it a significant asset. Unfortunately, homeownership isn’t that easy for Gen Z.
Housing across the country has become unaffordable for the average person, including Gen Z. As a result of the crisis, many in this generation have chosen to return to their childhood homes.
Although owning a home may not be in the near future for some Zoomers, there can be benefits to living in a home. First of all, this generation is ahead of the curve when it comes to saving.
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This article originally appeared on GOBankingRates.com: 4 Gen Z Retirement Concerns
