Generational wealth gap: How can each group save and invest for their future?

New York Life | March 25, 2024

A father holding his young daughter in the air

Gaps in wealth across generations are becoming more pronounced. While the over-65s have accumulated substantial wealth over time, the younger generations are struggling to catch up. Let’s take a look at what each group can consider, to help them save and invest in the future.


Baby Boomers (1946 – 1964)

Experiencing a booming economy during their youth, Baby Boomers benefited from low housing costs and readily available pensions. According to the Fed, they currently hold 50% of all wealth in the U.S., spread across various asset classes.1 Experts say Baby Boomers will transfer over $50 trillion to their heirs over the coming decades.2 However, the combination of higher life expectancy and mounting healthcare costs could reduce the wealth passed down to other generations.

Top tips: Baby Boomers could enhance their retirement potential by combining pensions, increasing regular payments or making a lump sum contribution to their retirement savings accounts. Maximizing social security benefits could also be beneficial for their financial outlook in the long term. 


Gen X (1965 – 1980)

Gex X are sandwiched between Baby Boomers and Millennials. For some, their finances are squeezed by eldercare costs, college fund savings, and childcare expenses. Although they have maintained higher rates of savings over the years, stagnant wages and stubborn debt mean there is growing unease about their retirement prospects. Gen Xers need $1.1 million to retire comfortably at 67, but currently fall short at $660,000.3

Top tips: By adopting smart financial habits such as budgeting, Gen Xers can ensure their spending aligns with their long-term savings goals. And as their careers grow, being mindful of “lifestyle inflation” – spending more as income increases – could allow for more opportunities to save.  

Downsizing could be another option to generate savings, either to cover costs or to enhance retirement quality. Delaying retirement is another option for boosting savings and ensuring a higher quality of living in retirement.

Millennials (1981 – 1996)

Born at the turn of the millennium, many in this group entered the workforce during unfavorable economic conditions following the 2008 global recession. They tended to live at home longer and, when they did fly the nest, rent rather than buy.  

Although their wealth is growing faster than that of Gen X, many Millennials struggle with persistent college debt and soaring house prices.

Top tips: Millennials could seek to prioritize repaying their student loan to facilitate saving for the future. Such a debt burden – on average $28,950 per borrower – could prevent them from saving for a down payment on a house or even an emergency fund for unexpected events.4

Despite the economic challenges Millennials face, there are still ways they can save for the future by cutting back on discretionary spending – and it’s never too early to start thinking about the future. Taking advantage of employee-sponsored retirement programs and matching pension contributions could help Millennials financially prepare for later life.   


Gen Z (1997 – 2012)

Gen Zers have been shaped by the digital age, climate concerns, and COVID-19. They are among the most financially-savvy people in the U.S. and are set to become powerful consumers.5 What their generational wealth looks like remains to be seen; however their income is expected to eclipse that of Millennials by the 2030s.6  

Top tips: Gen Zers are eager to learn and could benefit from an array of online sources about personal finance, financial planning, and reaching long-term wealth goals. Investing in the future though extracurricular certifications or qualifications could also help this generation appear more competitive in the workplace, which could accelerate their financial position longer term. 


Reach your financial goals

Whichever generation you belong too, saving sooner rather than later could be beneficial for your future. Try our savings goal calculator to find out how much you need to save to reach your financial goals.  


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Media contact

Kevin Maher
New York Life Insurance Company
(212) 576-7937