If you're in your 20s and already thinking about investing, you're ahead of the game - but you're not alone.
This is the most financially engaged generation Australia has seen, but being engaged is only half the equation. Knowing where to start, and what to prioritise, is what turns good intentions into real results.
Recent data from McCrindle shows 35% of Gen Z Australians are actively investing in shares, crypto, managed funds or other asset classes, while more than half stick to a monthly budget.
ETFs: a practical starting point for young investors
Exchange-traded funds are one of the most accessible entry points for anyone starting out.
An ETF is an investment fund that tracks a benchmark index, giving you exposure to a broad range of companies in a single purchase. Because they typically mirror major indices, they spread your risk across many holdings rather than concentrating it in one stock.
Another draw for younger investors is the ability to choose ETFs that align with personal interests or values. Some funds focus on technology companies, while others concentrate on environmental, social and governance themes. You can invest in areas you care about, whether that's clean energy, AI or the broader Australian market, without needing to pick individual winners.
Don't overlook cash savings
It's less exciting than watching a portfolio tick upward, but cash savings still matter.
Cash savings may not feel as thrilling as investing in markets, but they remain an important financial foundation. They're often used for short-term goals or to build a fund for larger investments, such as a home deposit.
Having a cash buffer also means you're not forced to sell investments at the wrong time if something unexpected comes up. That liquidity gives you options.
One thing worth doing now: check your savings account interest rate. In a shifting rate environment, the difference between a lazy account and a competitive one can add up to hundreds of dollars a year. It takes five minutes and costs nothing.
Superannuation: the investment you're already making
Super doesn't get much love from people in their 20s. It runs in the background, it's not something you can touch for decades, and it barely registers unless you change jobs.
But for many Gen Z people who have been in the workforce a while, super is the biggest investment they have. It's often larger than their savings, their share portfolio or anything sitting in a micro-investing app. And because it compounds over such a long time horizon, small decisions made now can translate into tens of thousands of dollars by retirement.
I'd recommend a quick super health check. Consider:
- Consolidating any duplicate accounts through MyGov, so you're not paying multiple sets of fees.
- Review your investment allocation, because at a younger age you can generally afford to be in a high-growth option.
- Take a look at how your fund performed over the past year compared to the competition.
These are simple moves. But the impact of getting them right in your 20s, rather than your 40s, is enormous.
The real advantage you have is time in the markets
Every investment strategy has trade-offs, but the one thing young investors have that older investors can't replicate is time. A well-diversified portfolio earning around a 10% return annually will roughly double in value every seven years through compounding. If you start at 22, your money has the potential to double four or five times before you retire. That's the kind of maths that simply doesn't work if you start at 40.
Stay invested long enough and modest initial amounts can grow substantially. You don't need thousands of dollars to begin. Micro-investing apps let you start with small, regular amounts and build from there. The important thing is starting.
Compounding works best over long periods. Starting early, even with small amounts, and staying consistent beats waiting until you have a large lump sum. The earlier you begin, the less heavy lifting your money has to do later.
A note on AI and financial advice
ASIC's 2026 Moneysmart study found that 63% of Gen Z use social media for financial information and guidance. Nearly one in five use AI platforms like ChatGPT, and 64% say they trust the financial information AI gives them.
There's nothing wrong with using AI to learn the basics. What's an ETF? How does compound interest work? These are fair questions, and AI tools can explain them clearly.
But there's a gap between understanding a concept and applying it to your own situation. A Credit Karma survey of more than 1,000 people found that 80% of Gen Z and millennials who used AI for financial advice said it helped. At the same time, over half said they'd made a poor financial decision based on what it told them.
AI doesn't know your income, your tax position, your debts or your goals (and feeding it that information may not be a good idea). It can't factor in your risk tolerance or tell you whether a particular investment fits your circumstances. It gives general answers to specific problems, and that's where things can go sideways.
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Disclaimer: The content is intended as general information only and should not be considered as advice on any matter and should not be relied upon as such. This has been prepared without taking into account any individual objectives, financial situation or needs. You should therefore consider the appropriateness of the information in regard to these factors before acting or seek advice before making any financial decisions. BlueRock Private Wealth is a corporate authorised representative of BR Advice ( AFSL No: 488 655, ABN: 30 612 056 523).
