Different generations might have different viewpoints about retirement based on their values and experiences, but one thing just about every age group agrees on is that you need a lot of money to retire comfortably in the United States.

A study released earlier this year by Northwestern Mutual found that every generation except boomers believes it takes over $1 million to retire comfortably. The average retirement savings target is $1.46 million. Here’s how it breaks down by generation:

• Gen Z: $1.63 million
• Millennials: $1.65 million
• Gen X: $1.56 million
• Baby boomers: $990,000

If it takes that much money to retire comfortably, then most Americans are in big trouble. A 2023 analysis from Synchrony Bank looked at different retirement savings estimates and found that Americans who are at or approaching retirement age don’t have nearly as much saved up as they might want:

• Average retirement savings per Vanguard
  • Ages 55-64: $207,874
  • Ages 65+: $232,710
• Median retirement savings per Federal Reserve:
  • Ages 55-64: $134,000
  • Ages 65-74: $164,000

In terms of how different generations view retirement, Goldman Sachs did a deep dive into the retirement aspirations and challenges of Gen Z, millennials, Gen X and boomers with its 2024 Retirement Survey & Insights Report. Here are some of the key findings.

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Gen Z

Nearly half of Gen Zers expect to retire before age 60. About three-quarters plan to retire with less than 70% of their working income, while 61% expect to fund less than half of their nest egg from personal savings vs. Social Security or pensions. Given the challenges with Social Security and increasing longevity risk, Gen Zers have the “daunting task of determining an appropriate plan,” according to Goldman Sachs.

Here are some other key takeaways:

• Save early and consistently.
• Plan conservatively and periodically refine your strategy.
• Expand your financial education to improve financial decision making.
• Develop a spending plan to track and monitor spending and income.
• Build financial resiliency by starting an emergency savings fund.

Millennials

Among all generations, millennials have been most impacted by competing financial priorities such as student loans, child care, education costs, home purchases and caring for parents. At the same time, they are also most likely to have a personalized plan for retirement and to consider hiring a financial advisor.

Other key takeaways include the following:

• Strive to maintain consistent retirement savings and investing.
• Leverage resources to navigate competing financial responsibilities.
• Personalize your retirement saving and investing strategy.
• Grow financial knowledge.
• Consider professional advice to improve your financial confidence.

Gen X

More than four in 10 (45%) Gen Xers say they are behind schedule for retirement savings, yet only 55% have a personalized plan for retirement. Some are beginning to enter retirement earlier than expected, mainly due to health or family care. Gen X is also the first generation to rely primarily on individual retirement savings such as 401(k) plans rather than pensions.

Here are some key things to focus on:

• Maximize retirement savings and tax-deferred opportunities.
• Develop a personalized retirement strategy to align with your retirement goals.
• Factor healthcare implications into your retirement planning process.

Working Baby Boomers

Although many baby boomers have already retired, younger boomers are still in the workforce and likely will be for several more years. Many are retiring later in life because they feel unprepared for retirement. Healthcare is the top financial concern while guaranteed income is the top priority in retirement.

Other takeaways include the following:

• Maximize retirement savings, catch-up contributions and other tax-deferred opportunities.
• Consider Social Security claiming strategies.
• Consider professional advice to increase your confidence regarding retirement spending.

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