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The Many Flavors of Retirement Savers: A Look at Generations

Practice Management

Editor’s note: This the second in a four-part series. The original appears in its entirety as the cover story of the Winter 2023 edition of Plan Consultant magazine. The digital edition of the Winter issue is available here. However, access to Plan Consultant is restricted to ASPPA members, so you’ll need to be logged in. The first part of this series appears here

Ok, Boomer

The Baby Boom generation — whose members were born roughly between 1945 and 1964 — is perhaps the one most affected by the shift from DB to DC plans, since Boomers’ parents were more broadly served by pension plans, while they were new or firmly in the workforce when the shift took hold. The Squared Away Blog run by the Boston College Center for Retirement Research notes that almost two-thirds of Boomers’ parents had a pension, while just 6% of those born at the end of the Baby Boom could say that. 

Boomers were caught in the middle of the transition, and that chaos was not a recipe for concerted retirement saving. For the most part, they didn’t save in their early years — there were no 401(k) plans, nor automatic enrollment/escalation of contributions. Not only that, many also lack pension plan coverage. And the blog also warns that Boomers may not remember that another price of DC plans is having to pay taxes on withdrawals, as well as the requirement that they make withdrawals by the time they reach a certain age. 

Gen X

Generation X — generally born between 1965 and 1980 — began entering the workforce when 401(k) plans were brand new and DB plans were declining. They were early adopters of 401(k)s, notes the Transamerica Center for Retirement Studies, and 81% are saving for retirement in an employer-sponsored 401(k) or similar plan.

Still, their confidence is low that they will be able to fully retire with a comfortable lifestyle — in part, says Transamerica, because the plans were not as sophisticated when they entered the workforce as they are now. 

So low is their confidence, says Transamerica, that 38% expect to retire at age 70 or older or do not plan to retire at all, and 55% plan to work in retirement. 

Gen Z (Born 1997 to 2012)  

Generation Z—generally considered to be those who were born between 1997 and 2012, entered the workforce shortly before the pandemic, notes Transamerica. They will have greater access to 401(k)s and workplace retirement plans than their predecessors.    

While 51% of them in Transamerica’s study report having trouble making ends meet, at the same time they have not given up on retirement: 67% are saving through employer-sponsored 401(k)s or similar retirement plans and/or outside the workplace — and started doing so at the tender median age of 19.

Generation Gap

Baby Boomers, the oldest part of the workforce, and Millennials — generally born between 1981 and 1996 and who make up the bulk of the young part of the workforce — are separated by more than age. They have somewhat different takes on saving and retirement — but not entirely in ways one may expect. 

Priorities. Some of the differences reported by the time2play blog are much to be expected and reflect where those demographic groups are in life. For instance, more Millennials than Boomers consider saving for a house their top saving priority, while more Boomers than Millennials put saving for retirement at the top. 


Top Priority Millennials Boomers
Emergency Fund 53% 61%
Saving for a House 25% 16%
Saving for Retirement   5% 13%


And looking even further ahead, Fidelity in its 2022 Career Assessment Survey reports that like their older peers, college students consider saving for retirement to be a priority — in fact, a majority, 54%, does.

Investing. Boomers maintain a more traditional approach when it comes to finances. With a focus on financial security and traditional investments, nearly half of Boomers (48%) invest in stocks, while only a fraction (5%) invest in digital currencies. At the same time however, a quarter of Millennials (24%) along with roughly a fifth of Gen X (19%) plan to invest in digital currencies in retirement.

Retirement. The two generations also differ regarding how they plan to live when they are retired, says Schwab in its Retirement Reimagined Study. Millennials embrace flexibility and new experiences in retirement to a greater extent than do Boomers, who value stability and consistency. 

Millennials appear to have an evolving vision of what it means to retire, says Schwab. Key findings include that Millennials: 

  • started saving for retirement nearly a full decade earlier than Boomers;
  • are likely to spend less time managing their personal finances and investments after they retire; and 
  • will be more likely to use their savings to achieve their dream lifestyle and pursue their passions along the way and once in retirement

Next: Individuals’ Response