March 14, 2023 – By Heather Taylor
Exactly how much does Gen Z have in savings? GOBankingRates reviewed two separate surveys — a freeform survey and its Best Banks 2023 survey — asking how much overall respondents including Gen Zers have in their savings accounts. Below is a look at the answers along with some of the best practices for building your savings.
How Much the Average Gen Zer Has in Savings
In a GOBankingRates survey polling 1,002 Americans, 29.44% of overall respondents of all ages said they had $500 or less in savings. Of those surveyed, 25% were between the ages of 18 to 24.
The survey also showed that 32.90% of overall respondents had $100 or less in savings. Gen Z accounted for 30% of those who said they had $100 or less.
Meanwhile, 19% of overall respondents said they kept between $101 to $500 in savings. Gen Z made up 13.84% of those with $101 to $500 in savings.
The comparison between the two surveys comes quite close. If you combine the percentages in the Best Banks 2023 survey with the freeform survey, 43% of Gen Zers have under $500 in their savings account.
How Much Gen Z Should Have in Savings
Building a robust savings as a Gen Zer means taking the same cues from building a savings for the average American. Gen Zers are recommended to keep between three to six months’ worth of savings as part of their emergency fund.
Aviva Pinto — CDFA, CDS and managing director at Wealthspire — said the reason for three to six months’ worth of savings is in the event of unforeseen emergency expenses. Much like all Americans, Gen Zers are feeling the impact of the overall increase in living expenses. Having an emergency fund established within their savings ensures they have enough cash to cover the basics, like groceries and bills, in the event of a sudden illness or a car breaking down.
What if you’re saving to reach a goal? Katie Ross, executive vice president for American Consumer Credit Counseling (ACCC), said you might need to put more money into your savings account each month than before. This is because of ongoing inflation, meaning the goals of Gen Zers might be more expensive than they were before.
The general recommendation is Gen Zers should continue adding more money to their emergency savings over the years. Do not treat this fund as a one-time savings. “Each year, if you keep a record of your budget, you will increase the amount the three to six months’ covers,” said Pinto.