Gen Z is redefining the benchmark for financial success, setting their sights on a net worth of $9.5 million to feel secure, according to a recent survey conducted by Empower, a financial services company. This target is nearly double the $5.3 million benchmark cited by Generation X, reflecting the unique economic pressures and anxieties faced by today’s youngest working adults.
The survey of over 2,200 Americans highlights how rising inflation, soaring housing costs, and an unpredictable job market are pushing Gen Z to aim higher than any previous generation.
Financial Success Redefined
Young adults in Gen Z, born between 1997 and 2012, estimate they need $9,469,847 to achieve financial stability. By contrast, Gen Xers, now in their 40s and 50s, view $5,295,072 as sufficient for long-term security.
Rebecca Rickert, head of communications at Empower, attributes this stark difference to the economic uncertainty Gen Z has grown up with. “Younger generations are doing the math and betting on needing more money to reach a future state of financial success,” Rickert explained to Fortune.
This trend extends to income expectations. Gen Z considers an ideal annual salary to be $587,797—more than triple the $180,865 ideal income cited by Millennials. In stark contrast, Boomers believe an income of $99,874 is sufficient.
A Generation Burdened by Financial Anxiety
Economic upheavals, from the pandemic to record-high inflation rates, have left Gen Z deeply anxious about their financial futures. As the youngest generation in the workforce, they often face lower starting salaries compared to their predecessors, compounding their stress.
“Gen Z has come of age in an era marked by significant economic disruptions,” Rickert noted. “Student loan debt, a challenging housing market, and a diminished belief in the American Dream are all contributing factors.”
A Pew Research Center study echoes this sentiment, revealing that Gen Z is far less optimistic about achieving traditional milestones like homeownership, retirement, and raising a family than previous generations.
Gen X and Retirement Concerns
While Gen Z looks ahead with trepidation, Gen X faces its own financial struggles. With many now in their 50s, this generation is grappling with the challenge of securing sufficient retirement funds.
Despite aiming for a net worth of over $5 million, 44% of Gen Xers surveyed by Natixis Investment Managers believe achieving a secure retirement will require a miracle. Longer lifespans, diminished pension plans, and rising living costs are forcing many to delay retirement or even return to the workforce.
The Path Forward for Gen Z
While financial anxiety weighs heavily on Gen Z, they remain optimistic. A robust 71% believe they will achieve financial success in their lifetime, surpassing the confidence levels of Millennials (70%), Gen Xers (53%), and Boomers (45%).
This determination stems partly from observing their parents’ financial struggles, which serve as both a cautionary tale and a motivator. “The comparison effect is significant,” Rickert added, noting that young adults are keenly aware of what it takes to avoid the same pitfalls.
As economic uncertainty persists, Gen Z’s high financial aspirations underline the shifting landscape of wealth and security in America.
Jaja has a degree in journalism and took classes in international law and business communication. Her career spans roles at prominent international media outlets, including International Business Times, Celebeat and Delightful Philippines. As a news editor, Jaja covered a wide range of beats, including legal, business, economy, cryptocurrency, personal finance, gaming, technology, and entertainment.