A growing number of young Americans are anxious about their financial future — and many are turning to doom spending as a way to cope. However, venture capitalist and "Shark Tank" guest judge Rashaun Williams says Gen Z can still retire as millionaires by following a simple, disciplined approach, Fortune reported.
Williams says that the key to long-term wealth is avoiding doom spending and focusing on three steps: building an emergency fund, maxing out retirement account contributions, and keeping investments straightforward. The multimillionaire investor emphasized that consistent action, not luck, drives success.
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Build a Financial Safety Net
Williams' first step is establishing an emergency fund. He recommends saving at least three months' worth of expenses to cover unexpected life events like job loss or medical bills.
"Make sure you have enough cash for a rainy day, so you're not pulling from your 401(k) prematurely," Williams told Fortune.
Some financial institutions, such as Wells Fargo (NYSE:WFC), suggest six months' worth of savings as a more secure buffer.
Max Out Retirement Accounts
Williams stresses the power of retirement accounts like the 401(k) and Roth IRA. With consistent contributions over time, he says Gen Z can easily hit seven figures by retirement.
"If you just do that from 25 to 50 years old, you're going to retire a millionaire," Williams said. "Just by maxing out your 401(k), it grows tax deferred, and it goes in tax-free. There's no better return than to get your returns without taxes. "
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As of 2025, employees can contribute up to $23,500 annually to a 401(k), while the maximum yearly contribution to a Roth IRA is $7,000 for individuals under 50, subject to income limits.
Fidelity Investments recommends saving at least 15% of annual income for retirement — a benchmark also supported by fellow "Shark Tank" investor Kevin O'Leary.
"Take 15% of your salary each week, or every two weeks when you get paid, and put it into an investment account, and never touch it until you turn 65," O'Leary told US Weekly in 2023. "That's how you will retire a multimillionaire."
The national average savings rate is currently about 14.1%, according to Fidelity.
Simplify Your Investments
For young investors tempted by high-risk opportunities such as cryptocurrency, Williams recommends going back to basics. He suggests sticking with broad-based index funds — particularly those tracking the S&P 500.
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"You don't have to get cute, you don't need international, you don't need bonds," Williams told Fortune. "You're not 90 years old. Just do S&P."
The S&P 500 has delivered an average annual return of approximately 10% over the past century, according to Investopedia's analysis of historical market data.
Build Wealth by Starting a Business
For those who want to build wealth before retirement, "Shark Tank" investor Robert Herjavec offered one more piece of advice: start your own venture.
"Start something that you can invest in, that you can grow, and start your own business," Herjavec told US Weekly. "It's the only path to wealth."
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