From the tech bubble burst to the Great Recession, members of Generation X have had their list of financial woes and notable setbacks impacting their long-term financial planning.
Each generation develops its own financial traits and stereotypes. While those with birth dates ranging from 1961 to 1981 seem to have drawn the short end of the straw when it comes to financial disasters, each generation faces its own unique set of issues. Gen X is sandwiched between the Baby Boomers, known for their spending, and Millennials, who are overloaded with student debt but reject credit cards. It’s not unfair to question the financial wherewithal of Gen X.
Research tells us that Gen X seems to be particularly underprepared for life after age 65. A report from Financial Finesse notes that only 22 percent of this generation feels they are prepared for retirement. They are slowly trailing other generations when it comes to retirement preparedness. From 2004, this generation was one of the strongest in home ownership until 2015, when it fell to one of the least. In addition to having seen the loss of pensions and rising healthcare costs, this generation has and will have many obstacles to overcome. When you consider these changes, it’s no surprise that some say they are struggling with regular money management and have fewer insurance and estate plans.
Key financial areas for Generation X
This generation needs help in key areas. First, they need to increase their money management ability. Second, they need to make sure that they have appropriate insurance and financial planning in place. And third, they need to be encouraged in the areas of retirement planning and investing with increased savings. Although these are significant areas to remember when working with Gen X clients, there is a silver lining.
According to a 2016 study from Transamerica, 77 percent of Gen X’ers surveyed said that they were saving for retirement. Generation X was the only generation in this survey to improve on thinking that they were prepared for retirement. This is on the heels of many understanding that they will be working past the age of 65. Their realistic expectations put them ahead of other generations. This financial preparedness is movement in a positive direction. There is hope and let’s face it, there is still plenty of time for many of them.