Generation X is often labeled the generation least financially prepared for retirement. There’s good evidence that many in this cohort are woefully behind in saving, for a plethora of reasons.
But a new report has a different spin on that specter with evidence that things may be on the upswing for those born between 1965 and 1980 — even if they refuse to believe it.
According to new research from the FINRA Investor Education Foundation, Gen Xers are doing fairly well financially, at least in terms of retirement preparedness and debt management.
“The news about retirement savings is generally positive for Gen X,” Gerri Walsh, president of the FINRA Investor Education Foundation, told Yahoo Finance.
Over 6 in 10 Gen Xers have some type of retirement account. And among Gen X retirement savers, the vast majority are actively contributing to their accounts, and few are withdrawing assets from them.
“Gen Xers are faring better than younger generations and comparable to boomers on the retirement measures we examined,” Walsh said.
A recent Bank of America research report corroborates this good news vibe.
Not only has the share of Gen X 401(k) participants that increased their contribution rate bumped up this year over last, but also “data suggests that some Gen X households are investing relatively large quantities of their paychecks … to fund additional investment accounts,” according to the researchers.
“In fact, the average amount invested by Gen X from after-tax earnings is over 40% higher than the overall population and higher than all other generations.”
Read more: Retirement planning: A step-by-step guide
“Super savers” are workers who participate in a 401(k) or similar retirement plan and contribute more than 10% of their salaries to it.
Research from the Transamerica Center for Retirement Studies found that the percentage of Gen X super savers has climbed significantly from 3 in 10 in 2019 to 4 in 10 this year.
“The increase for Gen Xers is truly impressive,” said Catherine Collinson, CEO and president of Transamerica Institute and Transamerica Center for Retirement Studies.
That’s significant given that the oldest Gen Xers are less than a decade away from a target retirement age of 65.
“Retirement is a light that is growing closer and brighter on the horizon for Gen X,” she said. “It is becoming more real — procrastination is not an option.”
Read more: What is the retirement age for Social Security, 401(k), and IRA withdrawals?
Sounds rosy, right? Try telling that to the so-called slackers.
“Despite these indications of relatively good financial health, few Gen Xers have positive feelings about their financial situation,” FINRA’S Walsh said. “In fact, their views are much more negative than those of baby boomers.”
Why the cynicism when it comes to their financial well-being? “The disconnect between objective and subjective financial health is larger for Gen X than for other generations studied,” she said.
“For one, they’re the first generation to do worse than their parents, so perhaps their expectations about where they would be financially at this point in their lives have fallen short of reality,” she said.
It’s also likely that many Gen Xers are currently in “a financially demanding and stress-inducing life stage,” Walsh said. “They are wrestling with the psychological and financial costs of raising kids and paying college tuition while simultaneously incurring the costs of caring for aging parents.”
The FINRA research also uncovered high levels of anxiety about debt for this generation — particularly student debt. About 1 in 4 Gen Xers reported having student loan debt and 60% are concerned that they won’t be able to pay off those loans, according to the data. Interestingly, 1 in 5 Gen Xers with student loan debt hold it for someone else, like a child or a grandchild.
Read more: Tips and tricks for quickly paying off student loans
We’re not done yet. There’s more fodder exposing the sad faces of this cohort: A majority of Gen Xers say they do not think they will be financially ready for retirement when the time comes, the lowest confidence reported among any generation, according to the latest findings of Northwestern Mutual’s 2024 Planning & Progress Study.
“Many Gen Xers have watched their parents’ generation age into retirement and experience long-term care events,” Rebecca Bast, a wealth management adviser at Northwestern Mutual, told Yahoo Finance.
That creates anxiety, she added. “They understand the real risk that a long-term event could create in their financial lives, and yet relatively few have acted to help prevent it.”
The catch-up contribution limit that generally applies for employees aged 50 and over who participate in most 401(k), 403(b), governmental 457 plans, and the federal government’s Thrift Savings Plan remains $7,500 for 2025.
But under a change made in Secure 2.0, a higher catch-up contribution limit applies for employees aged 60, 61, 62, and 63 who participate in these plans. For 2025, this higher catch-up contribution limit is $11,250.
“The ability for the older Gen Xers, who will be 60 next year, to save a little bit more could be a way that folks can boost their confidence,” Marci Stewart, director of client experience at Schwab Workplace Financial Services, told Yahoo Finance.
Another way to shake the doldrums: Create a retirement plan.
“Just 30% of Gen Xers have a plan for how they will take income in retirement and many feel that they have not saved enough for retirement,” Kelly LaVigne, vice president of Consumer Insights at Allianz Life, told Yahoo Finance.
If you don’t have a plan, you’re just guessing. And that’s not a good feeling.
“Gen Xers need to start thinking practically about what their retirement will look like,” LaVigne said. “With the oldest Gen Xers about to turn 60, retirement is no longer this far-off idea.”
Time to snap out of it.
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Kerry Hannon is a Senior Columnist at Yahoo Finance. She is a career and retirement strategist, and the author of 14 books, including “In Control at 50+: How to Succeed in The New World of Work” and “Never Too Old To Get Rich.” Follow her on X @kerryhannon.
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