A recent Survey by Voya Financial has unveiled a sentiment shared by Americans across all age groups: a profound wish that they had started saving earlier. This revelation highlights a pressing need for increased Financial Literacy and proactive saving habits, especially in an era marked by economic uncertainty and the shifting landscape of retirement planning.
Voya Financial’s consumer research survey involved a diverse demographic, encompassing Gen Z, Millennials, Gen X, and Baby Boomers. The results were strikingly consistent across the board: a significant majority in each generation expressed regret over not initiating their savings journey sooner.
On average, Gen Z and millennials started saving for retirement much earlier than Gen X and baby boomers. Gen Z had the earliest start on average, reporting they started saving for retirement around 20 years old. Millennials on average started at 24 but wished they had started saving at 23.
Generation X and baby boomers started saving for retirement much later than younger generations, with Gen X starting at 30 compared to a desired age of 23. Baby boomers had the biggest gap in their average start age and their desired start age: beginning at 32 versus 24. 23 is the average age Americans say they wish they started saving for retirement on average, that’s five years earlier than when they say they started saving for retirement.
Ultimately, every generation wished they had started saving for retirement sooner. This widespread sentiment suggests a universal recognition of the importance of early financial planning, despite the varying economic challenges and opportunities each generation has faced.
The economy (64%) and inflation (61%) continue to be the top concerns regarding the impact on the ability to save for retirement. About half of Americans cited everyday living expenses (54%) and health care costs (49%) as having a “severe” or “major” impact on the ability to save for retirement.
The survey’s findings resonate deeply in the current economic climate, characterized by inflation, rising living costs, and concerns over the future of social security. Many respondents indicated that these factors contribute to their financial insecurities and their retrospective desire for better savings habits.
The survey also highlighted the pivotal role of employer-sponsored retirement plans in encouraging early saving. A significant number of respondents indicated that access to such plans through their employers had been a crucial factor in their ability to save.
“This recent Voya data highlights how the design of a workplace retirement plan can help encourage employees of all ages to maximize the benefits of employer-sponsored retirement accounts as soon as possible,” said Tom Armstrong, VP, Customer Analytics & Insight at Voya Financial. “For employers, plan design features such as automatic enrollment, automatic escalation and matching contributions can play a critical role in saving sooner.”
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