According to Logica Research’s online survey for Schwab Retirement Plan Services, 4 out of 10 Gen Z and Millennials want to invest in cryptocurrency in their 401k retirement plans. Between April 4 and April 19, 2022, approximately 1000 people completed the survey.
According to the study, Gen Z and Millennial workers are more likely to invest in cryptocurrency, annuities, real estate, and small businesses than in 401 k retirement plans. In comparison, the results for Generation X and Boomers were disappointing.
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Previously, older workers believed that 401 k was their only option for retirement; however, times have changed. Generation Z and Generation Y workers have begun to question traditional approaches to not only retirement but also work.
During the Pandemic, most workers’ priorities shifted, and many people changed careers; as a result, financial goals shifted as well. With time, technological advancement, and increased awareness, the new generation has become extremely cautious when making financial decisions.
They have realized they can achieve their financial objectives by diversifying their assets. As a result, the 401 k retirement plan is gradually losing its position as a primary retirement saving tool.
New Generation Prefers Diverse Choices
The shifting of jobs during the pandemic has shown Gen Z and Gen Y employees that there are more ways to save and invest money. They typically favor a diverse range of investment vehicles and options. According to the survey, roughly four in ten Millennial and Gen Z workers wish they could choose cryptocurrency and annuities as 401 k investment options.
More than 7 in 10 young employees, on the other hand, prefer that the investment reflects their personal values. When 61% of Gen X and Boomers indicated that their first experience with investing was through a 401 K, the proportion of Gen Y or Millennials was relatively lower at 54%.
The results were even worse for Generation Z, with only 37% of young workers agreeing that their first experience with 401k was with a 401k.
What are the retirement plans for the next generation?
Many factors influence retirement savings, including rising costs and market volatility. However, Gen Z and Millennials are more likely than older generations to mention unexpected expenses. Boomers and Gen X want to retire at 64 and 67, respectively.
However, Generation Z and Millennials want to retire at the ages of 60 and 62, respectively. In terms of retirement savings, Gen Z believes they will require approximately $1.4 million, while Gen Y believes they will require approximately $1.8 million.
The rising popularity of cryptocurrencies, advanced social media, increased awareness, and altered career plans have all had a significant impact on the financial goals of the next generation. Workers in Generation Z and Millennial prefer to have more investment options for retirement than Gen X and Boomers. According to the findings of a Schwab 401 k study, the new generation wants to take advantage of a broader range of retirement resources than older generations.
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