Gen Z is making significant headway in building personal savings this year but may be missing out on ways to maximize their efforts.
According to a recent survey by Santander Bank, 58% of Gen Z and 54% of millennials have increased their savings since the beginning of 2025. That’s compared to 47% of Gen X and 39% of baby boomers who achieved similar growth.
The commitment to saving is widespread among respondents in younger generations too, as 81% of Gen Z and 79% of millennials say they consider growing their savings a top priority.
They’ll also make lifestyle adjustments to reach their savings goals, with 69% of Gen Z and 62% of millennials reporting making trade-offs to save more.
Morning Consult conducted the research for Santander Bank through an online survey of over 2,200 American adults in June.
Santander says that younger savers could be missing out on more competitive rates and potentially higher returns through high-yield savings accounts or certificates of deposit (CDs).
A significant portion continue to hold their primary funds in lower-yielding options, such as traditional savings or checking accounts.
The survey shows that 61% of consumers are interested in opening a CD, with this interest being most pronounced among younger generations.
Swati Bhatia, head of retail banking and transformation for Santander Bank, noted in a summary of the findings:
“It’s encouraging to see younger consumers embracing the importance of saving. … These savers now have an opportunity to grow their savings further by using high-yield savings accounts and CDs that are currently offering meaningful interest rates.”
The time to act could be running out, however. The Federal Reserve’s next meeting on Sept. 17 could result in a decrease in the federal funds rate, the first since December 2024. A federal funds rate cut generally results in lower interest rates on various bank products shortly thereafter.
Securing a longer-term CD before a rate reduction can mean locking in a fixed interest rate and securing your money for the CD’s duration. It’s worth noting, however, that early withdrawals from CDs may incur penalties, although there are penalty-free CDs.
While only 8% of Gen Z currently own a CD, nearly three-quarters express interest in acquiring one before rates potentially decline, but many are unaware of how such accounts work.
Santander also notes that savers who proactively plan have better financial outcomes. Respondents reported that the top strategies for reaching their savings goals include setting a budget and sticking to it, cutting spending and utilizing automated transfers into savings accounts.
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