Era X — the now middle-aged former latchkey youngsters who spent a lot of their childhoods unsupervised in entrance of MTV — are recognized for his or her independence, resourcefulness and pessimism.
That pessimism, it appears, extends to retirement. Of all generations, Gen Xers (these born between 1965-1980) are the least prone to really feel assured they’ll attain their retirement targets, with solely 43% saying so, in keeping with PNC Financial institution’s Monetary Wellness within the Office Report [1].
Whereas 50% of boomers and millennials are assured they’ll attain their desired retirement, Gen Z is essentially the most assured at 56%.
“I imagine so few Gen Xers really feel assured about retirement as a result of they’re carrying the heaviest load proper now. They’re paying mortgages, placing youngsters via faculty, and in lots of instances serving to getting old mother and father,” Karla Dennis, CEO of tax planning agency KDA Inc., advised Newsweek [2].
Many individuals from the era dubbed “slackers” maybe deserve some slack: They’re combating inflation, in addition to excessive housing and health-care prices, largely with out office retirement plans to fall again on. Few Gen Xers (simply 14%) have an outlined profit plan, in keeping with the Nationwide Institute on Retirement Safety, and solely 55% take part in employer-sponsored retirement financial savings plans [3].
Gen Xers are additionally anxious in regards to the future viability of Social Safety. If nothing modifications, the belief fund reserves that pay out Social Safety are projected to grow to be bancrupt by 2035, which means retirees would solely obtain 83% of their profit, except Congress takes motion earlier than then [4].
Whereas it might not seem to be it, Individuals have 63% extra buying energy than they did again in 1973, as measured by the Shopper Worth Index, in keeping with an evaluation from ConsumerAffairs.
“On paper, right now’s greenback goes additional, permitting extra room for nonessential spending,” the evaluation says.
So why are so many people feeling the pinch, once we suppose we ought to be on a agency monetary footing by now? It’s that the prices of housing and faculty tuition — main bills for Gen Xers — have skyrocketed, tempering the influence of purchasing-power good points.
The price of a house has risen about 1,045% since 1973 [5]. A 3rd of Individuals aged 44-59 are carrying a mortgage, in keeping with a examine by Experian. And, of all generations, Gen Xers pay essentially the most — with a median month-to-month fee of $2,313 — though the youthful millennials have larger common mortgage balances.
“Family measurement explains a part of this: Gen X households usually tend to have youngsters, and fewer prone to be single-person households, than youthful householders, so their properties can have bigger footprints,” the Experian report says [6].
In the meantime, even accounting for inflation, tuition has elevated by 177% (for public faculty tuition) and 158% (for personal faculty tuition) for the reason that 70s [5] — a serious pressure on mother and father of college-aged youngsters.
And a few are paying tuition for 2 generations: Gen Xers who’re nonetheless paying their very own scholar loans even have the very best common stability ($44,240) of any age group, in keeping with the Training Information Initiative [7].
Gen X is solidly middle-aged, and so they’re continually caught within the center: They’re paying off scholar debt, whereas additionally serving to to place their very own youngsters via faculty. Many are taking care of youngsters, and virtually one in 4 (22%) are additionally financially supporting no less than one guardian or parent-in-law, in keeping with a survey from LendingTree.
That duty has put many within the MTV era right into a monetary gap: Greater than half (58%) of Individuals who’re supporting getting old mother and father have gone into debt doing so [8].
Given the prices of protecting a mortgage whereas supporting college-age youngsters and getting old mother and father, it’s no marvel that members of Gen X are serious about their retirement targets with their trademark pessimism. However it doesn’t must be this manner.
Learn extra: There’s nonetheless a 35% probability of a recession hitting the American financial system this 12 months — defend your retirement financial savings with these 10 important cash strikes ASAP
With so many pressures, what can Gen Xers do to ease the sandwich-generation squeeze and meet their retirement financial savings targets?
To make the retirement math work, some Gen Xers might want to search for extra sources of revenue. Based on a Nasdaq article, Gen X got here of age when job-hopping was much less commonplace than it’s now, which is why they is likely to be incomes the identical quantity as their a lot youthful counterparts. Asking for a elevate or transferring to a brand new firm might assist increase their general revenue [9].
For these with caregiving tasks, discovering time to tackle a aspect gig might show difficult. However take into account discovering an exercise, like canine sitting, that’s each pleasurable and versatile. An alternative choice is to search for sources of passive revenue, similar to renting out a basement suite.
To seek out room in your funds, many monetary consultants advocate paying down high-interest debt like bank cards first. Whereas that’s simpler mentioned than finished, you might strive negotiating along with your card issuer for a decrease rate of interest or switching to a 0% stability switch card.
It’s additionally necessary to place some cash apart in an emergency fund, notably when you’re caring for family members who will face extra prices as they age. Make these financial savings be just right for you in a high-yield financial savings account.
From there, you may amp up your retirement financial savings. Begin by maxing out any employer-sponsored retirement financial savings accounts — notably in case your employer matches your contributions.
If you happen to’re 50+, you can even make catch-up contributions to your particular person retirement account (IRA). For instance, you may contribute an extra $1,000 in 2025 to the $7,000 annual restrict, for a complete of $8,000. You too can contribute an extra $7,500 to your 401(okay), past the $23,500 annual restrict, for a complete of $31,000 [10].
Then it’s time to consider taxes. Conventional IRAs supply a tax deduction, decreasing your taxable revenue for the 12 months, which might be a sensible transfer if you’re superior in your profession and have a comparatively excessive annual revenue. You’re taxed on withdrawals in retirement, when your annual revenue is far decrease.
With a Roth IRA, you’ve already paid the taxes, so in retirement you received’t owe taxes on withdrawals — and contributions and earnings develop tax-free.
Lastly, a diversified portfolio of shares, bonds and various investments might present the next return over the long run. It might be price talking along with your monetary advisor about adjusting your funding technique when you’re anxious about assembly your retirement timeline.
Be part of 200,000+ readers and get Moneywise’s greatest tales and unique interviews first — clear insights curated and delivered weekly. Subscribe now.
At Moneywise, we take into account it our duty to provide correct and reliable content material individuals can depend on to tell their monetary choices. We depend on vetted sources similar to authorities information, monetary information and skilled interviews and spotlight credible third-party reporting when acceptable. We’re dedicated to transparency and accountability, correcting errors overtly and adhering to the perfect practices of the journalism business. For extra particulars, see our editorial ethics and tips.
[1]. PNC Financial institution. “2025 Monetary Wellness within the Office Report”
[2]. Newsweek. “Gen X Are Most Apprehensive About Retirement Objectives”
[3]. Nationwide Institute on Retirement Safety. “New Report Finds Alarming Retirement Outlook for Era X”
[4]. CNBC. “Will Social Safety run out? Right here’s what might occur to your advantages”
[5]. ConsumerAffairs. “Evaluating the prices of generations”
[6]. Experian. “Gen X, Millennials Pay Extra for Their Mortgages”
[7]. Training Information Initiative. “Scholar Mortgage Debt by Era”
[8]. LendingTree. “Almost Half of Individuals Financially Assist Growing older Mother and father or Count on to”
[9]. Nasdaq. “6 Causes Gen X Is Not Making Sufficient Cash To Pay Money owed”
[10]. IRS. “401(okay) restrict will increase to $23,500 for 2025, IRA restrict stays $7,000”
This text gives info solely and shouldn’t be construed as recommendation. It’s supplied with out guarantee of any sort.
