Gen Z Is Now Helping Fill Gender Gap During Retirement; Here's How

Women, notably from millennial and Gen Z groups, are reshaping finance, powering a surge in retirement savings. This dynamic shift signals a potential end to the enduring gender gap in retirement savings.

Ishika Thanvi
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In the ever-evolving landscape of finance, a remarkable shift is occurring, one that holds the potential to reshape the retirement savings game: women, especially those from the millennial and Gen Z cohorts, are taking the reins of their financial destinies, stepping up their investment and savings game with a vigour that could finally narrow the persistent gender gap in the retirement arena.


Fidelity, the heavyweight in employer-sponsored retirement plans and individual retirement accounts (IRAs) in the U.S., dropped a statistic - a whopping 48% surge in women customers this year compared to 2019. The breakdown is even more staggering, with millennial women clocking in at the same 48%, and Gen Z women nearly doubling that figure.

The real eye-opener, though, is in the investing arena. Gen Z women, aged 18 to 26, are not just participating; they're setting the pace. More than 70% of them are diving into investments, outpacing their millennial counterparts at 63%, Gen X at 55%, and baby boomer women at 57%. Fidelity's numbers speak volumes - this surge in female investors might just be the disruptor needed to close the gender gap in retirement savings.

Women Are Taking Financial Agency Seriously

Zooming out, it's clear that women across generations are shifting gears towards financial security. Fidelity's report indicates that over two-thirds of women now claim they're saving for retirement, up from 66% in 2019. While this still trails behind men at 77%, the gap is narrowing as women ramp up their financial game.

Taking a closer look at the numbers,  Bank of America's 2023 report throws an interesting curveball. On average, men's 401(k) plan balances are 50% larger than women's. However, this gap seems to be tightening among the younger generations, signalling a promising shift in the landscape of retirement preparedness.

Enter Generation Z, the game-changers in the retirement savings arena. A Transamerica Institute study reveals that Gen Z is rewriting the rules by starting their retirement savings journey at an unprecedentedly early age - 19. This surpasses the starting age for millennials at 25, Gen X at 30, and boomers at 35. This is because Gen Z now has the golden ticket - unparalleled access to 401(k)s and workplace retirement plans.


But it's not just about numbers; it's about confidence. Gen Z women are emerging as financial warriors, with almost 60% expressing confidence in their financial preparedness for retirement. This optimism surpasses millennials at 43%, Gen X at 38%, and even boomer women at 48%, according to Northwestern Mutual's recent study.

In a world where the narrative is often dominated by gender gaps, these seismic shifts in women's financial habits could be the hope needed for revolutionary change. The stage is set for future generations to follow suit, creating an equal playing field and effectively narrowing the gender gap in retirement savings. The era of empowered financial futures for women is on the horizon, and the ripples of change are already making waves.

Suggested reading: Watch: Gen Z Woman Cribs About 9-5 Job; Sparks Divided Opinions

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