Many people try to put money aside each month, whether it's for a new car, or maybe a down payment on a house. But a recent poll has revealed which generation is the savviest when it comes to saving.
The poll, conducted by Talker Research, asked 1,000 Americans of varying ages how much of their paycheck they save each month.
The results show that 29 percent of overall respondents save between 1 and 10 percent of their monthly income, while an equal proportion don't save a dime. When respondents were categorized by age, there was a clear divide between younger generations and their older counterparts.
Indeed, 21 percent of Generation Z (people born between 1997 and 2012) save between 1 and 10 percent, and 25 percent save between 11 and 20 percent each month. In addition, 12 percent of Gen Zers manage to save around 21 to 30 percent of their monthly wage.
Perhaps most interestingly, 5 percent of Gen Zers save their entire monthly salary, higher than any other generation in the poll.
Millennials (people born between 1981 and 1996) weren't far behind Gen Z, as 30 percent save up to 10 percent of their paycheck, and 24 percent save between 11 and 20 percent. However, 26 percent of millennials save nothing each month, compared to 16 percent of Gen Z.
Perhaps unsurprisingly, not saving anything was highest among older generations. None of the respondents from the Silent Generation (people born between 1928 and 1945) put money aside, and 32 percent of Baby Boomers (people born between 1946 and 1964) don't save money. Additionally, 33 percent of Generation X (those born between 1965 and 1980) don't save any money.
Why Are Gen Z So Financially Savvy?
Many Gen Zers are now in their twenties and taking the leap into adulthood. That means they've got many milestones ahead of them.
Julie Beckham, assistant vice president and financial education officer at Rockland Trust, has told Newsweek that Gen Z are in the "building stage of life" and many of their biggest accomplishments are just around the corner. For them, saving is vitally important to achieve these "financial rites of passage" that require forward planning.
"Typically, Gen Z is also more cautious about taking on financial risks because they've seen the impact of student loans on older generations. They understand the weight of debt too, which may be fueling their desire to save for financial milestones and their future," Beckham said.
Gen Z was the first generation to grow up with social media, and Beckham suggests many of them have used this to their advantage. Whether it's through following social media influencers who provide saving tips, or listening to podcasts about personal finance, Gen Zers are empowering themselves through knowledge.
"They're self-educating in ways that weren't as accessible to previous generations, including the importance of establishing saving as a healthy financial habit," Beckham told Newsweek.
For anyone who needs a helping hand, Beckham reminds people that consistency is key, and sometimes getting started is the hardest part. Only start with an amount you're comfortable with and take it from there. It doesn't matter if it's $5 or $500, it's still a start.
Automating the process can be a huge help too, as the money will be saved even if you forget.
"Think of setting aside money as paying your future self," Beckham continued. "Creating an intentional plan that's aligned with your goals will help you decide how to best save and spend your money. It will make the process feel more meaningful and motivate you to stay on track."