Gen Z has its sights set on an early retirement.
A new survey from the financial firm Principal finds that on average, members of Gen Z who are saving aggressively for retirement expect to stop working around age 57. Roughly half of those savers (48%) expect to have nest eggs with more than $2 million by the time they retire.
The survey polled more than 1,100 retirement “super saver” plan participants over the summer, 9% of whom belonged to Generation Z (those born after the mid-1990s).
Of all the groups surveyed, Gen Z plans on retiring the earliest. On average, Gen Y super savers expect to retire around age 58. Gen X savers are expecting to stop working around age 63, according to Principal's survey.
Principal defines a super saver as someone who saves either 15% of their income towards retirement or who saves between 90% and 100% of the IRS’s retirement contribution limit. For 2022, the 401(k) contribution limit is $20,500.
Retiring at 57 may be difficult to achieve. The average retirement age now is about 65 for men and about 62 for women, according to the Center for Retirement Research at Boston College, and it has risen steadily for years.
Yet a serious commitment to retirement saving is nothing new for Gen Z — even among those who aren’t considered “super savers.” At the beginning of the year, a survey from Fidelity found that the number of retirement accounts among Gen Z investors had surged nearly 150% over the previous 12 month, while 53% of Gen Z workers had boosted their 401(k) contributions in 2021.
Another survey conducted this spring by investment giant BlackRock found that on average, Gen Z is saving 14% of their income towards retirement. That’s more than millennials, Gen X and Boomers. (Granted, members of Gen Z are probably earning less than their older counterparts, and therefore they may be saving less in terms of actual dollars, but still.)
Among the Gen Z respondents of Principal’s survey, 91% said their proudest money accomplishment has been saving for retirement.