Almost 31% of Gen Z workers, ages 18 to 25 have not contributed to retirement savings in at least two years, a move that could ultimately cost them hundreds of thousands of dollars in retirement savings, according to a new Bankrate report.

With inflation and the higher cost of living, upping their investments may not be a top priority for Gen Zers. Others say new expenses, wanting to keep more cash in their pockets, reduced income and market volatility are other reasons why they haven’t put money away for retirement.

But Emily Kamen, Associate Vice President at Mercadien Asset Management in Hamilton said it is so important for Gen Zers to put a plan in place and start saving money now, even if it’s just a little bit.

What are some key ways to save?

The easiest thing to do is to have Auto Pay come directly out of the paycheck so you don’t even see it, Kamen said. Only do what you can. There is no reason to strap yourself but having a small amount taken out each pay cycle will go a long way.

The end of the year could mean annual bonuses. “A good rule of thumb is if you do get a bonus, take half of that and put it toward your future self. That money could be working for you in retirement,” Kamen said.

If you’re fortunate enough to get a raise and you can take a portion of that raise to go to future savings, then turning on that Auto Pay, that could be a great retirement savings tool, she added.

This time of year can be a great time to kickstart savings if you’re new to the workforce.

How much should young people save?

Always look at your budget. See what you’re spending. See if you have any extra money a month that you could put into savings.

Just start anywhere, Kamen said. If you can put away 10% from every paycheck, that’s great, but if you’re only comfortable starting with 3%, that’s fine too.

“If you work for a company that has a 401K or a similar plan, and they have a match, contribute at least up to that match because that’s essentially free money you’re getting into the plan,” Kamen said.

The more that savings are top of mind, the more you’ll want to save in the future. If you’re not saving anything right now and you do not see that coming out of your paycheck every month, it’s out of sight out of mind, making it harder to start in the future.

The best course of action is to start when you can, start with what you can, and then increase from there, she advised.

For Gen Zers, time is their biggest ally

So, start investing today, even with a little money, and make it an ironclad discipline.
Have an emergency fund or a little cushion consisting of one to three months’ expenses for younger people, so if something comes up, they can take it out of cash flow.

Look at savings for bigger ticket items that you’re planning to purchase in the next couple of years. Then focus on investments and retirement savings.

There have been periods of volatility this year. Kamen said for those lucky young workers who have some extra cash looking to invest, uncertainty is a good time to buy because things are on sale.

Is it ever too late to start saving for retirement?

It’s never too late to start saving, Kamen said. But time is definitely on the side of Gen Zers. They have many years to put money away in a savings or retirement plan.

It can be easy to feel bad about yourself if you don’t save enough. But she said to stay focused on the goal. It’s okay if you can’t contribute money every month. It’s the long-term focus that matters.

Jen Ursillo is a reporter and anchor for New Jersey 101.5. You can reach her at

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