Nearly half of Gen Z workers save for vacation before retirement, JPMorgan survey finds. The trade-off signals deeper budget strain and knowledge gaps across all ages.
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Nearly half of Gen Z workers aged 18 to 29 put saving for a vacation ahead of retirement, the highest share of any age group, according to a JPMorgan Asset Management survey released Monday.
The online poll of more than 2,000 people who contribute to employer-sponsored retirement plans found that paying off student loans and building emergency funds also rank above retirement for younger workers. “This may be due to limited understanding of the benefits of starting early – especially compounding – and more immediate financial pressures,” Alyson Frost, head of retirement insights at JPMorgan Asset Management, told Yahoo Finance. “Debt feels urgent, and retirement can seem distant, making it easier to defer saving.”
The trade-off is not unique to Gen Z. When forced to choose between retirement savings and other goals, more than half of workers of all ages prioritize an emergency fund. Roughly 30% put paying off education or general debt first, and a similar share pick vacations. One in 10 said higher living expenses have reduced or stopped retirement contributions entirely.
“This reflects both an intention gap and real-world constraints,” Frost said. “Higher prices and inflation appear to be creating a real budget squeeze that is spilling over from day-to-day spending into retirement behavior.”
Leakage from retirement accounts remains a persistent problem. One in four survey respondents have taken a loan or early withdrawal from their plans, and another 19% plan to do so. “The persistence of loans and early withdrawals suggests many participants are using their retirement plan as a source of short-term liquidity, which can erode long-term outcomes,” Frost said. The top reasons are unexpected expenses, a home purchase, credit card debt, helping a family member, and healthcare costs.
Knowledge gaps are stark. More than half of respondents do not know how much they need to save each year to retire securely or how to estimate the future value of their savings at their current contribution rates. Nearly two-thirds wish they could delegate all planning and investing to a financial professional.
Only 11% of savers base their contribution rate on how much they think they need. One-quarter contribute as much as they can afford, 22% contribute enough to get the employer match, and 17% believe they are contributing the legal maximum.
The survey also reveals a gap between expected and actual retirement ages. More than 40% of Gen Z hope to retire before 65, and two-thirds expect to retire before 60. Among current retirees, nearly 70% retired before 65. Retirement experts note that health issues, job loss, and caregiving often force earlier-than-planned exits.
For JPMorgan, which manages $3.9 trillion in assets under supervision, the findings underscore the need for plan design features that address behavioral biases. Auto-enrollment, auto-escalation, and managed accounts can close the intention gap without requiring participants to master compounding math or asset allocation. The firm has pushed such features for years and continues to see adoption rise.
Frost said the results highlight how household budget strain directly disrupts retirement progress. “When many participants don’t know how much they need to save, and some are reducing or stopping contributions due to higher prices, it reinforces uncertainty,” she said.
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