What Advisors Can Do for Gen Z Right Now

What You Need to Know

Many Gen Zers started to invest before age 20, Schwab’s new Modern Wealth Survey shows.
They haven’t had a reason to seek professional advice yet.
But that will change, and you can lay the foundation now.

The next generation has taken up investing sooner and on a greater scale than previous generations.

In the latest Charles Schwab Modern Wealth Survey, results show that members of Generation Z, generally considered those born from 1997 to 2012, are benefiting from increased financial education, widespread market information and online trading that has expanded access to everyone.

As a member of Gen Z myself, I picked up investing at the ripe age of 17, before I was even able to legally open an account in my name. My high school’s required economics course had a semester-long project called “The Stock Market Game” in which teams across the state were given a mock $100,000 portfolio to invest for the largest return. I won and have been hooked on investing ever since.

According to Schwab’s survey, Gen Z is light years ahead of prior generations, with the average investor starting at just age 19 compared with age 25 for millennials, 32 for Gen X, and 35 for baby boomers. While impressive, the statistic on its own is misleading. As others in Gen Z who have yet to start investing begin later in life, this average age will increase.

The overall uptake of investing in my generation is impressive already. Sixty-three percent of baby boomers, the oldest generation surveyed, are investing. Gen Z, whose respondents in this survey range in age from 21 to 26, is close on the heels of older generations with 45% already investing. Millennials fall in between the two with 54% investing, and Gen X with 58% investing.

This coincides with a general increase in investors across the United States as entry barriers have dropped significantly. Per the most recent Federal Reserve data, which Schwab’s survey matches, 58% of Americans — the highest proportion in history — have investments.

What’s different about this generation? Gen Z doesn’t remember tough economic times. Of course, each person’s upbringing is distinct, but the vast majority of this age group was either not born yet or too young to remember the economic devastation of the global financial crisis of 2007-08, let alone the dot-com bubble and ensuing events of the late 1990s into the early 2000s. Their memory spans only the expansionary decade following the Great Recession and the COVID-19 cycle of the past four years.

So how do advisors appeal to a younger generation taking up investing in droves?