Multi-generational survey shows how retirement planning is changing


For many investors, retirement planning represents the bulk, if not the sum total, of their investing activity. In 2020, there were approximately 60 million active 401(k) participants, in addition to former employees and retirees. But while millions of adults in the United States are contributing to retirement, opinions on retirement investing and all that goes with it are anything but uniform.

Investopedia conducted an online survey of 4,000 American adults to quantify Americans’ understanding of financial literacy at the generational level, from Baby Boomers to Gen Z. Below, we explore some of the key findings from this survey. when it comes to investing and planning for retirement. .

Key points to remember

  • A small majority of American adults expect to retire, with Gen Z being the most optimistic about early retirement.
  • Two-thirds of millennials and Gen X adults are planning for retirement, and 42% of Gen Zers are doing so as well.
  • Younger generations believe that cryptocurrencies will figure prominently in their retirement support.
  • Americans of all generations are unsure of their understanding of retirement planning and need additional guidance.
  • Fintechs facilitate the retirement planning process through robo-advisor services, insurance changes, mobile trading platforms, and more.

Young adults expect early retirement

One of the main findings of the survey is that the majority of adults in each generation expect to be able to retire. 57% of adults aged 18-25, representing Generation Z, and 62% of millennials believe they will retire at some point. Nearly two-thirds of Gen Xers expect to retire or have already retired early (as Gen Xers encompass adults aged 42-57). And the vast majority of baby boomers have already retired or plan to do so. Young adults expect to stop working at an earlier age (57 for Gen Z, 61 for Millennials), while baby boomers who are not yet retired anticipate they will hang up their hats at 68, on average.

Depending on your perspective, the above data may or may not be encouraging. These majorities, especially in the younger generation, are slim. However, they paint a more optimistic picture of Americans’ view of retirement than the 2021 data from the Natixis Global Retirement Index. This research report indicated that a majority of American adults expected they would have to continue working longer than expected, with a significant minority of 40% saying it would take “a miracle” to be financially secure in retirement. . Natixis data may reflect heightened financial planning concerns caused by the early stages of the COVID-19 pandemic; Yet other data suggests that near and recent retirees may not have changed their plans on a large scale due to the pandemic.

Many have made retirement planning a priority

As most adults expect to retire one day, a large part of every generation has taken steps to achieve this goal by starting to plan for retirement now. About two-thirds of Millennials and Gen X adults surveyed said they were planning for retirement, and just over half of Baby Boomers did the same.

Unsurprisingly, Gen Z adults furthest from retirement age had the lowest percentage in this area. Even still, 42% of Gen Zers surveyed said they were already planning for retirement, even in their late teens and early twenties.

Pension plans by generation

Generations diverge when it comes to how survey participants expect to support their retirement. Older generations, Gen X and Baby Boomers, overall plan to support themselves through Social Security benefits, followed by 401(k) plans and retirement plans. Younger generations predict that 401(k)s will be the main source of retirement income, but also expect Social Security to play an important role. A surprisingly large minority of Millennials and Gen Z adults expect cryptocurrency investments to be important in retirement as well.

The generational bias in this data is generally consistent with the harsh realities that Social Security faces in the future. As expected, both Social Security and Medicare will experience long-term funding shortfalls due to soaring costs as more of the population lives longer in retirement. Officials predict that some funds will be exhausted by the mid-2030s. Understandably, young adults may feel that social security support is by no means a given by the time they reach retirement age, and the survey results indicate that younger generations expect to prioritize other supporters instead.

Younger adults are increasingly seeing cryptocurrency investments as a viable way to plan for retirement. In just over a decade since Bitcoin’s launch, interest in cryptocurrencies has skyrocketed, with some estimates now suggesting that one in 10 people invest in digital tokens.

With the growing interest in cryptocurrencies, more and more investors are incorporating tokens into their retirement plans as well. However, the significant volatility of digital currencies, regulatory uncertainties, and lack of a proven track record as investment vehicles can make cryptocurrencies a dangerous place to go in search of long-term returns.

Another factor changing retirement planning is the influx of financial technology (fintech) companies focused on this area. According to economists Julie Agnew and Olivia S. Mitchell, robo-advisors, new initiatives in life insurance pricing, and technology designed to manage asset decumulation in retirement are among the ways Fintech industry is already disrupting retirement.

Lack of education, worry clouds optimism for many

The Investopedia survey found that American adults lack confidence in their understanding of retirement planning. Behind digital currencies and investing, retirement was the third least understood concept, with more than a quarter of respondents indicating they had only a beginner’s understanding.

As above, however, the data diverges when broken down by generation. Nearly half of millennials said they have an advanced understanding of retirement planning, and 40% of Gen Xers. Gen Z feels the least informed about retirement, which is perhaps to be expected given that the standard retirement age is at least four decades for members of this group.

Retirement tops the list of financial worries

Not only do Americans feel misinformed about retirement planning, they also feel apprehensive about it. About one-sixth of respondents listed retirement as their top personal finance concern. Generation X, which is closest to retirement age, is particularly affected. They have also witnessed dramatic economic events throughout their retirement savings years, including the Great Recession of 2007 to 2009 and, more recently, the economic uncertainty surrounding the COVID-19 pandemic.

In contrast, only one in 10 Gen Zers cited retirement as their number one concern. Again, this could be because retirement is the furthest away for this group. It may also reflect feelings of optimism – as noted above, Gen Z expected to stop working at age 57, well before normal retirement age. As Gen Z’s earning and savings potential increases over time, it’s possible that their overall feelings about retirement may also change.

Americans need more advice on retirement planning

At a time of economic uncertainty, with a complex geopolitical landscape at home and abroad, and the lingering effects of a devastating pandemic, retirement may not be the most immediate priority for some American adults. Worries about seismic changes to come, including the economic effects of climate change, drying up of Social Security funds and continued wealth inequality, may also be of concern to investors considering planning for retirement.

Still, there are reasons to be optimistic about the retirement landscape going forward. A significant percentage of adults think about and participate in long-term planning. Fintech developments such as robo-advisors and mobile trading apps can make the retirement savings process easier than ever. And great resources are available for those who feel uncertain or overwhelmed by the prospect of planning for retirement.


The 2022 Investopedia Financial Literacy Survey quantifies American adults’ understanding of their own financial literacy at a generational level. The survey was conducted via a self-administered online opt-in questionnaire between January 27 and February 7, 2022 among 4,000 American adults, 1,000 from each of the following generations: Generation Z (18-25), millennials (26-41), Generation X (42-57) and Baby Boomers (58-76). Quotas and data weighting were used to ensure representation of race/ethnicity, gender, region and income among the total and within each generation. To learn more, see the full methodology.

Survey research and data analysis led by Amanda Morelli.

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