Significant majorities of young people, but only a minority of their boomer parents, contribute regularly to individual retirement accounts, according to new research.
TD Ameritrade Holding Corp., Omaha, Neb., published this finding in a summary of results from an online survey in April of 2,001 U.S residents. The poll was conducted on behalf of TD Ameritrade by Head Research, Toronto, Canada.
The report reveals that 59% of Generation X (born 1965 to 1976) and 56% of Generation Y (born 1977 to 1989) make regular, automatic contributions toward their retirement savings. This compares to 46% of non-retired baby Boomers (born 1946-1964).
The report also shows that both Gen X and Gen Y started saving for retirement, on average, in their mid- to late-twenties. That's nearly a decade earlier than Baby Boomers who, on average, stared saving at age 35.
"Gen X and Y have accepted the reality of the past few years, and rather than being discouraged, they are using what they've witnessed to their advantage by saving earlier and regularly," says Carrie Braxdale, managing director, investor services, TD Ameritrade, Inc., a broker dealer subsidiary of TD Ameritrade Holding Corp. "The hope is that tomorrow's investors, Gen Z, follow suit as they near retirement."
