About 50% Of Millennials And Gen Z Prefer Crypto For Retirement: Research

Oct. 27, 2022
About 50% Of Millennials And Gen Z Prefer Crypto For Retirement: Research

Millennials (born between 1981 and 1996) and Gen Z (born between 1996 and 2012) seem more interested in the crypto market and other investment plans than previous generations. The US asset manager Charles Schwab survey found that 50% of Gen Z and Millennials want crypto to be part of their 401(k) retirement plan.

Between April 4 and April 19, 2022, the Manager surveyed 1,100 401(k) retirement plan participants between the ages of 21 and 70, completed in 10 minutes.

A 401(k) plan is a defined contribution plan where an employee can make pre-tax or after-tax contributions from their salary, depending on the options offered in the plan.

Money grows tax-deferred with compound interest. For example, if you contribute $200 from each paycheck to your plan, you will not pay income tax on the amount of interest earned during the tax year. Instead, the interest is reinvested – basically letting your interest gain interest.

According to a survey, nearly 5 in 10, or 45% of Millennials and 46% of Generation Z, said they would like to add crypto to their retirement fund. This is in stark contrast to surveyed Gen X and Boomers, 31% and 11% of whom, respectively, want to invest in cryptocurrencies through their 401(k), even among existing investors in the asset class.

The online survey also revealed that 47% of Millennials and 43% of Gen Z have already saved for retirement by investing in cryptocurrencies outside their 401(k).

Meanwhile, 25% of respondents said they are saving for retirement by investing in crypto, with individual stocks accounting for more than 50% of retirement fund investments.

A similar survey by Investopedia in April revealed that only 28% of Millennials in the US, 20% of Gen X, and 17% of Gen Z expect to use cryptocurrency to help with retirement. 5% of Norwegians would like to save for their retirement in a crypto fund, revealed by Arcane Research, a cryptocurrency research firm based in Oslo, Norway, and the Big Four professional services firm EY in March.

Although cryptocurrency retirement funds have been operating since February 2019, the asset manager currently does not offer cryptocurrency investments as part of 401(k) retirement plans.

In April 2022, multinational financial services company, Fidelity Investments, announced that it would allow investors to allocate 20% of their 401(k) into BTC.

Dave Gray, head of workplace retirement offerings and platforms at the Boston-based Fidelity, stated:

There is a need for a diverse set of products and investment solutions for our investors. We fully expect that cryptocurrency is going to shape the way future generations think about investing for the near term and long term.

From November 2021, Australian pension fund provider Rest Super is exploring offering crypto as part of a diversification package for its 1.9 million members.

Most digital asset pension funds are available in bitcoin or ether a Northern Virginia county plans to invest a percentage of retirees’ pension funds in decentralized finance (DeFi) accounts in May 2022.

But mistakes are made. A Quebec pension fund has lost nearly all of the $154.7 million it invested in the now-bankrupt cryptocurrency lending platform Celsius.

Similar arguments have divided U.S. senators over the severity of the risks involved in crypto-exposed 401(k) retirement plans.


Syed Ali Haider

Researcher & Editor
Ali Haider is a Blockchain enthusiast and writer passionate about enhancing the acceptance, adoption, and integration of Blockchain technology worldwide. He has also advocated for digital freedom and cybersecurity for many years.