4 Key Signs Gen Z Is Doing Better Financially Than Millennials Were at Their Age
Written by
Andrew Lisa
Edited by
Molly Sullivan
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In terms of wealth building, it’s good to be young. According to the Federal Reserve Bank of New York, Gen Zers and millennials ages 18 to 39 have seen their wealth increase by 80% since 2019, compared with 10% for Gen Xers ages 40 to 54 and 30% for boomers over 55.
But the youngest millennials are nearing 30 and the oldest are in their 40s. They’ve had years or decades to learn, earn and advance in their careers and investing journeys that Gen Z has not. The youngest among them aren’t even teenagers yet, and the oldest are barely in their late 20s.
Even so, Gen Z has distinct advantages over their older millennial siblings and parents, and several signs indicate that the youngest adults might be doing better than millennials were at their age.
They Got an Early Jump on Investing
The clearest indicator that Gen Z is racing strong out of the gate is that they’re more likely to put their money to work than older demographics were at their age.
“I often work with young people just starting out on their financial journeys,” said Chris Demetriou, a financial expert, a qualified accountant and co-owner of Archimedia Accounts. “When Gen Zers come to me with questions, I assure them they’re far ahead of where millennials were at the same age if they’re doing things like investing early and consistently in assets like stocks, real estate and cryptocurrency to build their wealth over time.”
Many of them have been doing precisely that since before they were old enough to drink.
According to research from the CFA Institute, an impressive 82% of American Gen Zers began investing before they were 21, far outpacing older sets. More than 2 out of 5 got their start with cryptocurrency.
They’re Saving More for Retirement
Gen Zers are not just dabbling in Bitcoin. They also started building tax-advantaged nest eggs through employer-based retirement plans earlier than their older siblings and parents did.
According to a 2024 report from the Investment Company Institute, “Gen Z households with [defined contribution] plans are outpacing earlier generations on the path to retirement saving.”
And they’re not surpassing just millennials. The report shows that Gen Zers have roughly three times more assets in retirement accounts than Gen Xers did at a comparable age in 1989.
They’re Borrowing Less for College
College debt has become one of America’s most significant barriers to building wealth and financial stability. It’s not fair to measure cumulative student debt compared with that of other generations because much of Gen Z hasn’t yet reached college age, but statistics on per-capita borrowing are promising for the youngest adults.
According to the Education Data Initiative, Gen X has the highest average individual debt at $44,290 per average borrower — but at $32,800, millennials aren’t far behind.
The average Gen Z student borrower, on the other hand, owes just $14,380 — and they’re much more likely to put their borrowed dollars to good use. EDI data shows that millennials take on more debt by taking longer to finish their degrees — if they finish at all. A full 40% of millennials who started college did not finish within six years.
“There’s definitely less of an emphasis on college — and its huge associated debts — with this generation,” said Martin Orefice, CEO of Rent To Own Labs. “That, in turn, is putting them in a better position to afford housing,” which leads to the final sign that Gen Z is ahead of the curve.
They’re Ahead of Their Elders in Terms of Homeownership
Despite being young, not being far along in their careers, and coming of age in the most difficult and expensive housing market with the highest mortgage rates in decades, Gen Z is ahead of the pack when it comes to homeownership.
According to a 2024 report from Redfin, the homeownership rate for Gen Z stagnated in 2023, but even so, they’re still ahead of where their elders were when they were the same age.
The report stated, “The homeownership rates for 19-to-25-year-old Gen Zers are higher than the homeownership rates were for millennials and Gen Xers when they were the same age. For example, the rate for 24-year-old Gen Zers is 27.8%, compared with 24.5% for millennials when they were 24 and 23.5% of Gen Xers when they were 24.”
Homeownership — especially with decades ahead to pay off the loan — is still one of the surest tickets to long-term wealth building in America, and that’s good news for Gen Z.
“If you’re in your 20s and you’ve bought or are buying a home, you’re ahead of most millennials at that age,” said Melanie Musson, a finance and insurance expert with Clearsurance. “Part of the reason for the recent housing shortage in the past several years is that millennials were entering the market for the first time in their 30s. Buying a home when you’re younger gives you a head start on building equity.”
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