Members of Generation X are more concerned about their post-retirement ability to support the lifestyles they’ve grown accustomed to when compared with other generations — including baby boomers and millennials — according to the results of a recent survey conducted by Allianz Life.
In the company’s 2024 Annual Retirement Study, respondents indicated that 62% of Gen Xers “feel confident about being able to financially support all the things they want to do in life,” compared with 82% of baby boomers and 77% of millennials. But more than half of Gen X respondents (55%) also said they “wish that they would have saved more money for retirement,” a feeling that is more severe among Hispanic (63%) and Black (56%) members of the cohort.
“Gen Xers are reaching crunch time for retirement planning. For Gen Xers, retirement is no longer this far off idea. That can feel stressful, but by preparing now, they can create a strategy that will help them seek their ideal retirement,” Kelly LaVigne, vice president of consumer insights at Allianz Life, said in the report. “The good news is that it is never too late to prepare for retirement. You can wish you started sooner, but you’ll never wish that you waited longer.”
The most common action that the cohort is taking toward their long-term financial goals is in paying down debt (64%), building up an emergency fund (58%) and aiming to make choices that result in a material credit-score improvement (55%).
But high costs are also keeping many Gen Xers from saving more for retirement. They say that “expenses for day-to-day necessities (61%), credit card debt (40%) and housing debt (39%)” are the key culprits keeping them from saving more.
“Saving more overall is foundational to retirement,” Lavigne added. “However, Gen X may need to take this a step further and remember that a retirement strategy isn’t just about one big final number in the bank. Once you retire, you are going to need to draw from those assets for income.
”A sound retirement income strategy will help use your assets efficiently and include contingencies for risks that can cause you to spend down savings faster than anticipated. You need to ensure the money lasts.”
Despite the difference a long-term plan can make, few Gen Xers employ one, the study found. Only 35% of Gen X respondents said they use the services of a financial professional, compared to 46% of millennials and more than half of baby boomers. But Gen Xers are also thinking more about retirement than they have before, the results found.
“Nearly two in three (63%) say one of their top three goals in the next five years is to save enough and make plans to live a comfortable retirement,” the report stated. “This increased from 56% in 2023. Gen Xers who are Asian/Asian Americans (68%) were more likely to say this than white (61%), Hispanic (61%), and Black/African American Gen X respondents (55%).”
Older members of Gen X are increasingly approaching retirement age. Most researchers agree that the generation begins around the mid-1960s, and those born in 1965 will turn 59 in 2024.
While most members of the cohort are too young to qualify for a Home Equity Conversion Mortgage (HECM) through the Federal Housing Administration (FHA), several leading reverse mortgage lenders offer proprietary reverse mortgages that allow the eligible borrowing age to be as young as 55 in some states.
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Source: housingwire.com