‘New Year’ To-Do List For Gen-Z Retirement Savers

The new year brings the start of many things, the most likely being a hangover. No, not that kind of hangover. The one referenced here is the work hangover.

The end of the year fills your social calendar. That requires you to prioritize your work. The most important items get done. The rest you leave for January. Sometimes the entire month of January becomes nothing more than the “December catch-up.” The previous year’s work “hangs over” into the new year.

At some point, though, this hangover dissipates. You can finally begin creating a to-do list for the new year. When assembling this year’s list, young adults busy with their lives of today can’t ignore their lives of tomorrow. While each generation frames retirement saving differently, putting this off leads to a common error in your life planning process.

“The biggest mistake Gen-Z may make in investing for their retirement is not starting early enough or not saving enough,” says Joseph Carpenito, Financial Advisor at Materetsky Financial Group in Boynton Beach, Florida.

If you’re just out of school or a few years into your career, there is no better time to think about tomorrow than today. Those twenty-year-olds who are on top of their game are doing this right now.

“It’s January, and the typical Gen-Zers may be making a resolution to start saving for retirement or to increase their contributions to their existing retirement accounts,” says Dennis Shirshikov, Strategist at Awning Company in New York City. “This is a great time to review your financial goals and assess your progress towards meeting them. If saving for retirement is a priority, now is the time to take action and start making a plan to achieve your goals.”


Not all Gen-Zers work for companies that offer retirement benefits. That doesn’t mean they have no options. In fact, for this do-it-yourself generation, there are plenty of different paths to take that make it easy for you to save. And this is the season when decisions like this are made.

“The typical Gen-Zer is most likely deciding to start saving for retirement, as January is traditionally seen as a time to set financial goals for the coming year,” says Chris Morgan, Founder of Credit Help Info in Arlington, Texas. “Gen-Zers may look into investing in a retirement plan such as an IRA or 401(k) or setting up automated transfers from their checking accounts into a savings account dedicated to retirement. They may also be researching different investment options within those plans and deciding where their money should go for maximum growth and security.”

If you have access to a company 401(k) plan, you’ll want to take a close look at two things: your personal financial situation and the exact wording of the plan’s document. The first thing will tell you the best way to get started. The second thing will tell you what your initial savings goal should be.

“Gen-Zers are likely considering how much they can contribute into their employer-sponsored retirement plans,” says Jeff Mattonelli, Financial Advisor at Van Leeuwen & Company in Princeton, New Jersey. “The first piece to consider is how much they can afford from a cash flow perspective. If they received an increase in salary, this may be a great opportunity to increase their savings amount heading into the new year. Another factor to consider is the max contribution limit for 401(k)s has increased this year, so investors who were previously maxing out their 401(k)s should be checking to make sure they adjust their savings amount if they plan to max it out again this year.”

If this process sounds complex, or if you don’t have the time to devote to make a thorough analysis, don’t worry. There are a couple of rules of thumb you can quickly follow. This makes your decision-making easier, even if your firm lacks a retirement savings plan. Of course, if you’re really aggressive, you can take the lead by convincing your company to start a 401(k) plan.

“Hopefully, you’re looking at how much of your income you can start to put away for retirement,” says Eliza Arnold, founder of Arnie.co in Los Angeles. “If the thought of retirement planning is overwhelming, just start small and early, and you will be OK. Start trying to put away 5% of your monthly income, and then slowly raise it to 10%. You can use an IRA, which is usually free to open, or you can ask your employer about its 401(k) options. If your company doesn’t have one, then bring a list of a couple providers that you think align with your goals to your HR department. Most 401(k) plans are pretty cheap to run, so if your company knows you want one, they may be open to adding it as a benefit. But overall, the main takeaway is simply to start. It can be small, but as long as it’s consistent, you’ll see returns compound over time.”

In the end, it’s all about fundamentals. Saving for retirement contains important elements—thinking about tomorrow, planning ahead and having the discipline to execute that plan—that will help you in all areas of life, both present and future. Don’t let size intimidate you. Start small just to get started.

“When you’re just starting out, what’s especially important is creating good habits,” says Houston-based Terri Fiedler, President of Retirement Services for Corebridge Financial. “You have plenty of time to grow your career and build assets, so concentrate now on taking the first steps that can set you up for financial wellness. Two examples come to mind. First, enroll in your workplace retirement plan and make contributions, even if your budget only allows you to save a little bit right now. Starting to save early is a great habit and gives your retirement savings more time to grow. Second, connecting with a financial professional may not be the first thing Gen-Z thinks of when it comes to saving for retirement, but building that relationship early on can be incredibly important. Find out whether your employer’s retirement plan includes access to financial professionals and have that initial meeting to explore your short- and long-term financial goals. Just having the conversation can broaden your thinking about what you need to do for your finances and what your finances can do for you.”

Finally, if that December hangover lasts until February, you can still create your “January” to-do list. No matter what the groundhog tells you about the weather, any time of year is the best time to take those very tiny first steps that will lead you to a comfortable retirement.