- Gen Z is already looking to save for retirement, even in their early 20s!
- Gen Z is seeking good benefits from current and future employers
- The coronavirus has only solidified these important trends
CGK President and co-founder Jason Dorsey spoke to Plansponsor earlier this month about Gen Z and their propensity to save money at an early age. Dorsey, whose forthcoming book Zconomy is set to be released in September, shared the latest insights on Gen Z and their financial habits.
Our research has already been pointing to this young generation being better savers than their Millennial predecessors for the last several years. Coupled with the effects of the Great Recession of 2008 on their parents and the impacts of the pandemic starting to take shape on Gen Z directly, Gen Z’s fiscal cautiousness will likely solidify.
Leaders understand that these events will have profound effects, and Jason is already sharing these insights with clients in customized virtual events, podcasts, and interactive webinars.
Funding Retirement Accounts in Your Early 20s?!
In prior times, many workers coming straight out of college were not focused on putting away money for savings. Now, studies are showing that Gen Z is saving money at a higher percentage than other generations had done.
As Jason shared with Plansponsor, “12% of Gen Z workers have initiated their retirement savings, while 35% plan to begin saving in their 20s. These are people that are 23 years old and younger, and they’re already saving for retirement. They’re doing more comparison shopping, they’re shopping more in thrift stores, they were the ones that have the emergency accounts.”
Gen Z Favors Employers Who Offer ‘Traditional’ or ‘Real’ Benefits
Companies that offer free lunches and gym memberships as ‘deal-closers’ for Gen Z workers entering the workforce will be in for an unpleasant surprise. Young employees want to see solid health care benefits and retirement savings plans (e.g., 401k, 403b) that are matched by the employer.
Employers are going to have to compromise with Gen Z recruits, and Gen Z is willing to work with them. As Jason shared in the interview, “Sixty percent of Gen Z workers stated they would accept a 10% lower starting salary in return for a better benefits package. Already prior to COVID-19, these workers were showing that these benefits are important to them.”
The Pandemic is Reinforcing These Ideas for Gen Z
The pandemic is what we call a Generation Defining Moment for Gen Z. During this time of uncertainty, all of us are looking for stability. For Gen Z, it is about securing their future and being able to pay for healthcare.
The article notes the importance of “health care engagement” and gives the example of Health Savings Accounts (HSAs). These products are particularly important to Gen Z as they are likely to be at multiple jobs in their careers, and there is no penalty associated with HSAs.
Jason and his co-author, Dr. Denise Villa, write about what Gen Z is looking for, not only as employees but also as clients and trendsetters in their forthcoming book, Zconomy: How Gen Z Will Change the Future of Business—and What to Do About It.
How Can Leaders Adapt Now To Drive Results with Gen Z?
There are many challenges with the uncertainty happening now. In spite of this, leaders must ensure that their business can engage Gen Z and emerge from this period in time stronger.
Here at CGK, we are carefully researching how Gen Z and all generations are thinking about the economy, work, spending, brands, family, and much more during this ‘new normal.’ We are providing these insights to clients as executive briefings, webinars, and virtual keynote presentations to help leaders at all levels be accurately informed with missing data and solutions to drive results during this important time.
Contact our friendly team here to learn how our research and generational discoveries can help your team and organization through this time of uncertainty with our custom webinar, virtual keynotes, and more.