Gen Z workers who are saving for retirement saw their 401(k)s grow faster than millennials' did last quarter, while Gen X topped baby boomers on another milestone, according to data from Fidelity.
In an analysis of its 23.3 million 401(k) participants at the end of the first quarter, Fidelity said Thursday that the average balance for Gen Z increased 15% from the fourth quarter to $11,300, compared to an 11% increase to $59,800 for millennials.
Across all generations, the average balance rose 6% to $125,900. That suggests Gen X's average of balance of $178,500 and boomers' $241,200 didn't grow as fast as those of the younger cohorts.
Given that younger workers tend to invest more aggressively while older workers closer to retirement get more conservative, such differences between generations shouldn't be surprising.
But typical generational investing profiles could shift as separate surveys have shown that younger Americans are especially eager to retire early, with most millennials aiming for a nest egg of $1 million-$2 million and Gen Zers shooting for $500,000-$1 million.
"We are encouraged to see account balances increase, providing solid proof that retirement savers are remaining invested and continuing to make steady contributions—while seeing the financial benefits as a result," Sharon Brovelli, president of Workplace Investing at Fidelity Investments, said in the report. "With continued participation across generations and income levels, retirement savers will continue to build better financial futures, which is essential to the financial health of so many Americans and our economy."
Fidelity data also showed Gen X has reached a key milestone as retirement approaches for that generation while more boomers transition to their golden years.
Among long-term savers who have maintained the same 401(k) accounts for at least 15 years, the average balance for Gen X ($543,400) surpassed the average for boomers ($543,200) for the first time ever.
That marks a major tipping point as it represents Gen Xers getting ready to retire soon and saving more in contrast with boomers who are already spending down their savings after leaving the workforce.
But again, typical saving patterns may not apply to the current batch of retirees, as many boomers look to "unretirement plans" to stay active and avoid depression, working well into their 60s and even 70s.
Meanwhile, Fidelity said there were 485,000 401(k)-created millionaires in the first quarter, up 15% from the prior quarter and 43% from a year ago.
That's despite the topsy-turvy start to the year that financial markets saw as stocks and bonds sold off amid growing doubts the Federal Reserve would start cutting rates soon. To be sure, Fidelity's 401(k) millionaires have been in it for the long haul, saving for an average of 26 years with an average contribution rate of 17%.
The average balance was $1.58 million, up from $1.55 million in the fourth quarter, a Fidelity spokesperson told CNN.
