Generation X: The Struggling Retirement Savers

A new survey characterizes Gen X savers as “struggling,” noting that 40% of those workers agree with the statement, “I prefer not to think about or concern myself with retirement investing until I get closer to my retirement date.”

The survey by the Transamerica Center for Retirement Studies finds that Generation X (born 1965 to 1978), the first generation to have access to 401(k) plans for the majority of their working careers, is thinking about retirement, though their preparations are still lacking.

Seventy-seven percent of Generation X workers are saving for retirement and they started at age 28 (median), according to the report. Among those participating in a 401(k) or similar plan, they contribute 7% (median) of their annual pay.

The total household retirement savings for Generation X is $69,000 (estimated median). Just 12% are very confident that they will be able to fully retire with a comfortable lifestyle.

Just over half (52%) of Generation X workers say that they guessed their retirement savings needs, versus 12% who actually used a retirement calculator or completed a worksheet. The majority of Generation X workers (60%) say that they have a retirement strategy — 16% have a written plan, the remaining 44% say they have a plan — but it is not written down.

Nearly a third (30%) of Generation X retirement plan participants have taken a plan loan or early withdrawal, with commonly cited reasons relating to paying off debt or unplanned major expenses. The report notes that Generation X workers have saved just $5,000 (estimated median) to cover the cost of unexpected financial setbacks. About a quarter (24%) have saved less than $1,000 for such emergencies.

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