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If there’s one generation that’s behind on retirement savings and needs the help of financial advisors, it’s Gen X. While baby boomers are the wealthiest generation on record and millennials have proven surprisingly diligent when it comes to saving for retirement, Gen X is trailing their older and younger counterparts when it comes to retirement planning.
It’s concerning that Gen X – people born between 1965 and 1980 – are trailing in the retirement category and concerning for multiple reasons. First, the obvious. That being that the older members of Gen X are closing in on retirement age. Second, this generation isn’t feeling good about their retirement prospects. Not at all and that represents significant opportunity for advisors.
Indeed, data confirm that more Gen Xers are increasingly tapping advisors for retirement guidance. Alone, that’s good news, but there other encouraging points about this demographic. While most are gloomy in their economic outlooks for 2025, they’ve committed to bolstering savings to the point that they believe they can endure a year-long recession. However, there’s work to be done.
Consider the ‘Sandwich’
Gen X can be described as the “sandwich generation,” meaning they’re old enough to have children of their own, but not so old that both parents have passed on. That means many Gen Xers have dual caregiving responsibilities – a scenario that can be financially burdensome.
“The responsibilities of caring for older or younger family members, or both generations at the same time, can place tremendous strain on a financial plan,” notes Nationwide. “Many Gen Xers are feeling this strain today; more than half of Gen X investors are providing financial support to their older parents or younger children. Consequently, they’re running up credit card debt (24%) and cutting back non-essential spending (35%).”
Nationwide added that due to dual caregiving responsibilities, a quarter of Gen Xers outright halted or decreased saving for retirement. Nearly as bad as that is the fact that one in six were making withdrawals from retirement accounts to help with family financial obligations.
One way of looking at the above is that when connecting with Gen X clients, advisors should be overt in asking what their family situations. Ask clear questions about children and if the Gen X client is financially contributing to their parents. It could also be worth inquiring, in delicate fashion, if the client is aware of what their inheritance – if any – could be because that capital could go a long way to shoring up their retirement pictures.
Gen X Wants to Work with Advisors
Gen X isn’t taking their retirement laggard status lightly and many are turning to advisors for help to improve their situations.
“That’s why more Gen Xers are seeking out financial professionals for guidance. Our survey found an increase among Gen X investors paying for advisor services, up from 29% six months ago to 37% today,” observes Nationwide.
There’s more advisors to consider. The Nationwide survey points out that Gen Xers already working with advisors feel better equipped to avoid emotional decisions and better prepared to deal with market volatility. Those are points worth bringing up to Gen X prospects. Consider it a “humble brag.”
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