Advertiser Disclosure

Teens Are Counting on Parents to Finance Retirements, Study Shows

Attention moms and dads: your teens are counting on you for more than a few bucks for a movie or some new clothes. They’re depending on you to pay for their retirements too.


About 40 percent of young Americans aged 13 to 22 are expecting an inheritance and believe they don’t need to save for retirement, according to a study by the brokerage firm TD Ameritrade. At the same time, these so-called Generation Zers are hyper-focused on saving money for college.


“For even the most sophisticated investor, retirement planning can be a tough concept to grasp,” a TD spokeswoman said.


Generational Differences


The study found that individuals in Generations X and Y, those born between 1965 and 1989 who are slightly older than Generation Z, are paying close attention to their finances and retirement. Nearly 60 percent of both Gen Xers and Gen Yers make regular contributions to their retirement savings plans, and most started doing so in their early to mid-20s. That’s in sharp contrast to the Baby Boomers, now in their 60s and 70s, who typically started retirement savings at age 35.


The study also looked at more than 2,000 youths across the United States, showing that many young adults of Gen Z are acutely aware of financial difficulties since seeing their parents struggle through the recent recessions. They know the importance of saving money and putting it away for college, thanks to early conversation with their parents. Over half of these young adults have savings accounts, but only about eight percent said they are currently saving money for retirement. And only 16 percent of parents said they expect to leave an inheritance. These parents said the money they are saving is instead being tucked away for their own comfortable retirements. If there happens to be some left in the end, their kids will get it, parents said.


According to the study, Gen Zers and their parents have dramatically different ways of viewing their retirement finances:

  • About 45 percent of Gen Z survey participants said it’s never too late to start saving for retirement, compared to 71 percent of parents who said the same thing.
  • Nearly 40 percent of Gen Zers said they are planning on having an inheritance and don’t need to worry about retirement savings. About 16 percent of their parents said they plan on leaving inheritance money.
  • About 35 percent of Gen Zers said they wouldn’t be able to count on Social Security and need to start saving money for themselves. About 60 percent of parents said the same thing.


The bottom line is that Gen Zers do have good understanding of why saving money is important but are used to having their parents take care of financial matters. At the same time, these young adults are actively saving for college. More than 90 percent are enrolled in or plan to enroll in college. Nearly 70 percent of them said they are actively putting money away for college.

Bill “No Pay” Fay has lived a meager financial existence his entire life. He started writing/bragging about it in 2012, helping birth into existence as the site’s original “Frugal Man.” Prior to that, he spent more than 30 years covering the high finance world of college and professional sports for major publications, including the Associated Press, New York Times and Sports Illustrated. His interest in sports has waned some, but he is as passionate as ever about not reaching for his wallet. Bill can be reached at [email protected].

teen taking money

2 Minute Read

Table of Contents
    Add a header to begin generating the table of contents

    Home > Blog > Teens Are Counting on Parents to Finance Retirements, Study Shows


    1. Dugas, C. (2012, September 10). Teens: Mom and Dad Will Leave Me Enough to Retire. USA Today. Retrieved from
    2. TD Ameritrade. (2012, August 28). Young Americans Start Saving for Retirement 10 Years Earlier than Parents, Grandparents. TD Ameritrade Spotlight. Retrieved from
    3. TD Ameritrade. (2011, August 1). Saving For College Remains The No. 1 Financial Priority Among Today's Teens. TD Ameritrade Spotlight. Retrieved from