In an economic environment where the markets are struggling against inflation, more young adults are investing into their retirement.

Bloomberg reported in the third quarter of the year, about 83% of investors from the Generation Z and millennial age groups opened an account for retirement, such as a 401(k), and an individual retirement account or IRA. The numbers follow a trend, as young people who contribute to their IRAs went up 46% in 2019, according to The Washington Post.

Although the number of IRA accounts grew over the past year, the value of an average account dropped tremendously. Fidelity Investments reported value has dropped 25% over the year, down to $101,900.

Kevin Barry, who is the president of workplace investing at Fidelity, said that young investors giving little attention to their accounts’ values “have chosen wisely.”

“One of the most essential aspects of a sound retirement savings strategy is contributing enough consistently in up markets, down markets, and sideways markets — to help reach your goals,” Barry told The Sacramento Bee.

As opposed to a traditional IRA, a Roth IRA allows people to invest money that has been taxed and see tax-free returns once they retire.

Gen Z investors lean toward opening a Roth IRA rather than traditional accounts. With millennials reportedly making 20% less than individuals over age 40, young people earning little income prefer Roth IRAs because they provide a pathway to tax-free withdrawals when they retire.

“We are definitely seeing more enthusiasm around Roth than traditional,” Rita Assaf, who is vice president of retirement products at Fidelity, told CNBC. “Fidelity’s data found the number of millennial Roth IRA accounts with contributions is up 7.8% so far this year.”

While young people may not be concerned about tax deductions to their income now, they will think about them for the future.

Additionally, they are educating themselves on two critical factors in having a retirement investment account — liquidity and long-term investing.

Financial advisor Winnie Sun told CNBC that young investors are doing this “all in a very short conversation.”

“Don’t invest until you totally understand what you’re invested in,” Sun said.

For Baruch College students who want to open their own IRA — regardless if it’s a traditional account or Roth account — they need a government issued-ID card and their Social Security number. Additionally, they need funds to contribute plus options of stocks, bonds or index funds.

One can contribute to the account monthly, with a limit of $6,000 per month.

With the current state of financial markets, opening an IRA may seem intimidating or counter-intuitive. But with a Roth IRA or any other investment account for their retirement, a student can contribute money monthly in preparation for the future.

How a new investor’s capital grows depends on how the markets perform. Still, young investors would be contributing to the welfare of their future and put themselves on the road to a financially stable retirement.