A new survey reveals that Generation Z believes they need nearly $9.5 million in net worth to achieve financial success - almost double what their Gen X parents consider necessary, as they witness older generations grappling with retirement challenges.
According to financial service company Empower's survey of over 2,200 Americans, Gen Z sets their financial success benchmark at $9,469,847, while Gen X aims for $5,295,072. This stark difference highlights how younger generations are adjusting their financial expectations amid economic uncertainties.
The target figures decrease with age - millennials seek $5.6 million for financial success, while baby boomers consider $1 million sufficient. Similar patterns emerge in salary expectations, with Gen Z targeting $587,797 annually compared to Gen X's $212,321.
This generational divide in financial expectations stems from Gen Z's unique economic landscape. They've witnessed pandemic disruptions, record-high inflation rates, mounting student loan debt, and an increasingly challenging housing market. These factors, combined with watching their Gen X parents face retirement difficulties, have shaped their financial outlook.
The retirement landscape has changed dramatically. Gen X faces longer life expectancy without traditional pension benefits that many boomers enjoyed. A Natixis Investment Managers survey found that 44% of Gen Xers believe they need a "miracle" to retire securely, with many forced to extend their careers or return to work after retirement.
Despite setting higher financial targets, Gen Z remains optimistic. The survey shows 71% believe they'll reach their financial goals within their lifetime, compared to 53% of Gen X and 45% of baby boomers.
Rebecca Rickert, head of communications at Empower, notes that younger generations are carefully calculating their future needs, particularly as they observe their parents' generation navigating retirement challenges. This awareness has influenced their career choices and financial planning strategies.
The findings underscore a growing generational divide in financial expectations and highlight how economic realities are reshaping young adults' views on wealth, success, and retirement planning.