Meeting the retirement needs of Gen Z

Meeting the retirement needs of Gen Z


New outreach and communication approaches can help digital natives get their savings on track

Gen Zers are the first digital natives — a generation that grew up with the internet and smartphones. They’re highly mobile, they’re racially diverse, and many are immigrants or children of immigrants. Ranging in age from the early teens to the mid-twenties, Gen Zers are rapidly moving into the job market — and into their first retirement plans.

With Gen Zers projected to represent 30% of the workforce by 2030, it’s important to understand where they’re starting from when it comes to their financial well-being and retirement readiness.1 By better understanding them, we can better meet their needs and help put them on the path to financial freedom.

A growing segment of retirement savers

The number of “Zoomers” active in their employers’ corporate defined contribution plans has more than doubled since the beginning of 2020 — coinciding with a 25% decline in baby boomers.2 As Gen Zers increase their workforce representation, here are some important Gen Z retirement savings metrics detailing where they’re starting from.3

• Percent eligible and contributing: 88%

• Average savings rate: 5.9%

• Maximizing employer match: 62%

• Percent of engaged target date fund users: 45%4

What makes a Zoomer?

As Gen Zers become an integral part of the workforce, it’s important to better understand their backgrounds, preferences, values, and other factors that differentiate them from other generations.


Key characteristics of Gen Z


Gen Z will be the last generation that is predominantly white


Zoomers are skeptical of authority and rely heavily on their own judgment


At the same time, they are willing to work together to get things done

Digitally proficient

Unlike millennials, who were digital pioneers, Gen Zers are digital natives


Despite their digital proficiency, Zoomers prefer to minimize their online personas


Many Gen Zers are finding creative ways to make money online


Gen Z values safety and security, especially when it comes to finances

Unique consumers

Zoomers think of consumption in terms of access, not possession


Gen Z is highly educated — but skeptical about the cost of higher education

Employer insights to engage and support Gen Zers

 Gen Zers are very diverse. Don’t make assumptions about cultural background or practices when communicating with them.

• Build trust with Gen Zers with in-person meetings to encourage collaboration, productivity, and greater engagement related to their financial well-being.

• Gen Zers don’t lack initiative. Make them aware of opportunities in the workplace, and they’re likely to engage with their work, colleagues, and own financial planning.

• Consider Gen Zers’ values and belief systems when communicating with them. Their practical approach to consumption suggests an openness to learning about budgeting, finances, and retirement.

• There’s an opportunity for employers to help those with student loan debt early in their careers so it doesn’t derail short- and long-term plans. Provisions under the recently passed SECURE 2.0 Act of 2022 can help employees stay on track with their retirement savings while still paying down debt.

And when it comes to retirement plan engagement, we see strong benefits in having in-person meetings that include employees of all age groups, with the goal of promoting dialogue. Financial advisors should do more listening and less talking — avoiding coming across as the all-knowing wizard behind the curtain. Online materials should likewise embrace the idea that retirement solutions are more like shoes than scarves — there is no one-size-fits-all. A sure turn-off for Gen Zers is the idea that their personal “playlist” will be the same as everybody else’s.

Like all generations in their youth, Gen Zers regard old age as an abstraction far in the future. Simply telling them that “retirement will come sooner than you think” is hardly useful. Rather, meeting Zoomers on their own terms is the best way to improve plan engagement and boost savings for this savvy, mobile, and independent of generations.

Download the white paper to learn more about what defines Gen Zers.




1 Fortune, “Gen Z workers will be 30% of the workforce by 2030—hereʼs what they want from their employer,” May 27, 2022.

2 Empower, “Empowering America’s Financial Journey™,” 2022. The study draws from two sources of data: a) Empowerʼs recordkeeping data of 4.3 million active participants in primarily corporate plans, and b) a nationally representative survey of 2,505 working Americans with access to a defined contribution plan, conducted by FGS Global on behalf of Empower.

3 Ibid.

4 Engagement is defined as any interaction with Empower’s website, app, or Empower representative over the 12-month period between January 1, 2022, and December 31, 2022.

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