These Gen Z-ers are choosing ETFs over sports bets. How younger investors told us they're building wealth.

By Genna Contino

How is Gen Z investing their money? Brokerage data and market surveys show approaches ranging from low-cost retirement accounts and ETFs to individual stocks, gold and REITs

Interviews with more than a dozen young investors and data on their holdings show varying approaches, ranging from market-tracking exchange-traded funds and retirement accounts to individual stocks and more speculative wagers.

While some teenagers may mark their 18th birthdays by buying a lottery ticket or getting a first tattoo, Deon Radcliff Jr. had different priorities.

When the Tulane University freshman woke up on his birthday this August, his first order of business as a legal adult was opening a brokerage account and a high-yield savings account.

Radcliff had accumulated about $16,000 in cash from scholarships paid directly to him, in addition to his full ride at Tulane. He set aside $9,000 to immediately start investing in an S&P 500 SPX index fund, AI stocks, gold (GC00) and real-estate investment trusts.

Radcliff is part of a generation entering the financial markets unusually young, with easier access to investing than previous generations but vastly different amounts of money to put to work. Interviews with more than a dozen young investors and data on their holdings show varying approaches, ranging from market-tracking exchange-traded funds and retirement accounts to individual stocks and more speculative wagers. What they share is an effort to build financial security amid high living costs and an uncertain economic future.

Deon Radcliff Jr. receives his high school diploma from Da Vinci Schools in June.

About four years ago, Radcliff said, he asked his parents if they had investments or any assets to leave behind for him and his little sister. "It was always a constant answer of no," he recalled.

Radcliff, who is from South Los Angeles, said these conversations encouraged him to learn more about money and investing.

"My socioeconomic status has a really big impact on how my future could go, whether I want to be a detriment to my community or where I can benefit from the hardships of my community," he said.

As Radcliff embarks on his investing journey, he has a goal of graduating debt-free with $250,000 in assets. "I think that's 100% doable," he noted.

Here's how Gen Z is investing

The picture that emerges from a recent survey is more conventional than Generation Z's reputation for speculative investing might suggest.

Among Charles Schwab's (SCHW) clients classified as Gen Z - people ages 14 to 29 - 65% planned to add money to their investment portfolios in late-summer 2026, with ETFs the most popular investment, according to a recent sentiment report from the brokerage. Online trading platform Robinhood (HOOD) also says its younger clients favor ETFs "as early building blocks of investing, displaying healthy caution as they start their financial journey."

That doesn't mean young investors are avoiding risk-taking. A Betterment survey published earlier this year by the investing app found more than half of Gen Z respondents redirected money intended for traditional investing toward sports betting over the previous year, while roughly a quarter considered betting to be part of their long-term strategy. Some economists and financial commentators have linked that behavior to economic pessimism and rising living costs.

Taken together, the available data resist a simple characterization of younger investors as either overly cautious or speculative.

"Historically, younger people had a little bit more risk tolerance," said James Kostulias, Schwab's head of trading services. "What we're seeing now is they are a little bit more cautious, a little bit more cynical or a little bit more skeptical than some of the older generations."

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High-school financial-literacy teachers see that proactive mindset firsthand in their classrooms. Chad Mallo, a financial-literacy teacher in Florida who previously worked in banking for 20 years, said his high-school students are eager to avoid the debt and financial missteps they witnessed growing up.

"They are investing earlier, and they are actually more interested in wealth building," Mallo said. "They see the mistakes their parents are making, and they don't want to make that same mistake."

Gen Z lags "behind other generations in retirement-account and individual-stock ownership, likely due to being less affluent overall," said John McKenna, a senior analyst at the asset- and wealth-management research firm Cerulli Associates. "However, individual-stock ownership, as well as crypto, has risen the last few years, as has ownership of mutual funds and ETFs as part of the day-trading boom from the early 2020s."

While saving for retirement - and saving in general - is important for young people, McKenna said Gen Z-ers often face the more immediate concerns of paying off student loans or credit-card debt. They also are saving for short-term goals, such as a vacation or buying their first home.

To see where this generation is stashing its cash, researchers at Cerulli Associates analyzed Federal Reserve data to map out the financial assets of people under 30. But because the survey only interviewed "heads of household," the data skewed toward Gen Z-ers who were already affluent enough to lead a household at a young age.

Looking at a breakdown of their financial assets, this group kept the biggest share (30.6%) in retirement accounts - though this noticeably lagged behind people in their 30s (38.4%) and 40s (42.4%), who had more time to make contributions. Another 15.9% was held in mutual funds and ETFs, and 8% in individual stocks, both of which also trailed other cohorts. Younger households did hold a larger share of their wealth in cash compared to older generations, with 10.2% of their money in savings accounts and 7.5% in checking - compared to just 8.8% and 6.8%, respectively, for heads of households in their 30s.

Another notable outlier in the data was the "other managed assets" category, which accounted for 22.7% of the wealth in young households. For comparison, this category made up less than 5% of the total wealth for households headed by investors between the ages of 30 and 49. While McKenna noted this is primarily attributed to trust funds, it doesn't mean the average Gen Z-er has a trust to call upon. Instead, that wealth is heavily concentrated among a tiny fraction of young people who already have at least $2 million in financial assets.

Zooming into specific sectors, Gen Z was the most bullish on energy stocks and most bearish on real estate this quarter, according to the Schwab report, and their primary concern over the next three months was an AI bubble. Conversely, Schwab's active traders across all generations were more concerned by global macroeconomic issues, inflation and U.S. politics.

Even as Gen Z embraces traditional strategies like diversified stock portfolios, it's difficult to ignore the rise of prediction markets and sports betting, which are blurring the line between gambling and investing.

"When people feel as though they're falling behind, they will do riskier things. They'll try to pick individual stocks instead of sticking with broad ETFs. They will concentrate on a particular sector, maybe a high-growth sector like technology or AI. Or they're even more likely to get into gambling, all in an effort to try to catch up to their peers," said Alexander Smith, a professor at the Worcester Polytechnic Institute who specializes in behavioral economics.

"Low-income populations do a disproportionate amount of lottery gambling - and the current, modern version of that is how sports gambling has just taken off among young people today," he added.

Young investors don't follow a single financial playbook. Even given common economic pressures, the circumstances and the ways that they put their money to work vary widely.

Gen Z investors are not a monolith. Here's how some of them are putting their money to work.

John Taps, a 26-year-old in-house tax accountant, sticks to safe bets: S&P 500 index funds and gold.

The S&P 500 investor

Name: John Taps

Age: 26

Location: New York City

Occupation: In-house tax accountant

Taps said he watched his parents struggle during the 2008 financial crisis, so he plays it safe with his investments. He strictly avoids sports betting and prediction markets, invests primarily through a Roth IRA and a 401(k), and described his investing strategy as basic and conservative. The majority of his Roth IRA contributions - 80% - are invested in S&P 500 index funds, while he keeps 20% in gold as a hedge against the dollar DXY.

"I wanted to make sure I was not going to make any risky investing decisions - where, if something were to happen, myself and my family would still be OK," said Taps, who recently got engaged. It's about "making safe plays during good times for when the bad times come around," he noted.

The Roth IRA investor

Name: Makayla Wilson

Age: 22

Location: Los Angeles

Occupation: Graduate student

Wilson was introduced to the concept of investing during a college-readiness and financial-literacy class she took in high school, where the teacher, Christopher Jackson, helped students open Roth IRAs on their 18th birthday.

Topics like budgeting and investing weren't discussed at home when Wilson was growing up. She said that Jackson sharing his experience navigating his finances as a Black man made the class relatable.

Wilson, who was raised by a single mom, still contributes to her retirement account today and watches her money grow in index funds. She also used what she learned in the class to help her mother set up auto-pay on recurring payments and increase her credit score so that she could qualify for a car loan.

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