Among the best ways to amass wealth and construct a retirement nest egg is to start out investing early, even whether it is with a small amount of capital.

Gen Z investing trends follow this logic, in line with a latest survey from Charles Schwab (NYSE:SCHW).

Schwab’s 2024 Schwab Modern Wealth Survey found that 45% of adults within the Gen Z category, those born between 1997 and 2012, are investing available in the market. They’re investing at a better rate than other generations did at this age, and starting at a younger average age.

Gen Z investing starts at age 19

The Schwab survey found that 58% of Americans are invested in stocks today, up from 53% in 2019 and an all-time high for this survey.

Baby Boomers are essentially the most invested, at 63%, followed by Gen Xers at 58%, Millennials, at 54%, and Gen Zers at 45%. But that 45% total for Gen Z is higher than it was for older generations at this age.

It also found that the typical American began investing at age 30, but that drops much lower for the younger demographics. In Gen Z, the typical investor began at age 19, far lower than the Baby Boomers, who began at 35. Millennials began investing, on average, at age 25, while the starting age for Gen X was 32.

There are several aspects which have led to more Americans, particularly younger generations, investing within the stock market.

“We in fact saw the variety of Americans investing go up through the pandemic, but there are numerous aspects driving this trend that were in place before that and proceed to drive engagement today. Industry changes like lower costs and minimums to take a position and get advice, broader access to stylish platforms and tools, a proliferation of investing information resembling research and academic content, and significant product innovations have all made investing more accessible than ever before,” Jonathan Craig, Head of Investor Services at Charles Schwab, said.  

Education is paying off

The survey also found that 71% of Gen Z adults are confident of their investing strategy, which is a better percentage than the 70% average for all Americans. The youngest generation attributes its confidence to learning about investing in class.

Overall, 28% of Gen Z investors were taught about investing in class, in comparison with 19% of Millennials, 12% of Gen X, and 9% of Boomers. Further, 43% of Gen Z said they learned about investing at a young age, in comparison with 31% of Millennials, 26% of Gen X, and 18% of Baby Boomers.

Further evidence of the worth of monetary education is the finding that about half of all those surveyed who should not confident of their investment strategy say it’s because they weren’t taught about investments at a young age by family or in class.

Focused on growth

The survey also revealed that younger investors are more likely to take a position in growth stocks, which is sensible, considering they’ve an extended investment horizon. Specifically, 57% of Gen Z and 56% of Millennials are focused on growth investing, in comparison with 51% of Gen X and 48% of Boomers.

Also, 48% of Gen Z and 48% of Millennials use fractional shares investing, in comparison with 33% of Gen X and 25% of Boomers. This might be because they’ve less capital to take a position.

As well as, younger generations are much more likely to interact in socially responsible investing, as 43% of Gen Z and 45% of Millennials count themselves as socially responsible investors. Just 25% of Gen X and 17% of Boomers can say the identical.

One notable outlier involving Gen X is that only 48% consider themselves buy-and-hold investors. That’s in comparison with 60% of Boomers, 59% of Millennials, and 57% of Gen Z.

It is especially encouraging that Americans are getting began earlier because time available in the market is the only best solution to construct long-term wealth, because of the facility of compound earnings.

Buying and holding good stocks or ETFs for 30 or 40 years can grow exponentially over time, even with a small initial investment and modest monthly contributions.

“The results of this engagement and access to investing education and resources is a more sophisticated, more knowledgeable, and most significantly, more financially confident population of American investors,” Rob Williams, Managing Director of Financial Planning at Charles Schwab, said.