A new Vanguard report showed an increasing number of American workers participating in retirement plans and saving more money, but Gen Z is 'better prepared' than the rest.
American workers are receiving some "very encouraging" news about, with one generation, in particular, that’s most set up for success thanks to a "dramatic" shift in behavior, according to a new Vanguard report.
The U.S. saw significantly more millennial and Gen Z workers contributing to their savings or retirement plans in 2021 than compared to 2006 primarily due toand target-date funds. Vanguard client participation increased across all age groups as well, rising from 62% in 2006 to 82% in 2021. "What this paper shows is, across all generations, youngest up to the oldest, you've seen a dramatic change for the better in diversified investing in an age-appropriate way," the expert said.
"Those things had been certainly known and available before then, but the Pension Protection Act gave explicit fiduciary protection to plan sponsors if they wanted to implement this," he continued. "Since then, you've seen a lot of plan sponsors rush to adopt these best practices."Gen Z, who were aged 18-24 in 2021, are"best prepared for retirement" today in comparison to other age groups, Vanguard's Dave Stinnett said.