Data and Research

Gen X Most Concerned About Retirement Prospects

Less than four in ten Gen X DC plan participants surveyed believe they will have enough for a comfortable retirement.

By Rebecca Moore editors@plansponsor.com | September 01, 2016
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Spectrem Group’s DC Participant Insight Series report, “Financial Behaviors and the Investor’s Mindset,” which surveyed 1,442 participants in an employer-sponsored defined contribution (DC) retirement plan, found fewer than half of DC plan participants expect to have enough income to live comfortably during their retirement.

Millennials are more likely to feel confident, with 64% indicating they should have enough to make it through their retirement. Gen X investors are least comfortable with this idea, as less than four-in-ten believe they will have enough for retirement. More than half of males (55%) agree they will have enough, compared to only 44% of females.

When asked whether they were worried about depleting their retirement funds too early, DC plan participants rated themselves at a 51.78 on a 100-point scale. Millennials and WWII participants show less concern, rating themselves around a 41, while Gen Xers show the most concern. By plan balance, the most concerned participants are those with $50,000 to $99,999 in their plans.

More than three-fourths of plan participants feel the reason for their worry regarding running out of money in retirement is due to the cost of health care. Less than half attribute their worry to taxes or too much spending.

The majority of plan participants expect their household investable assets upon retirement to be less than $1 million. Thirty-five percent believe it will be between $500,000 and $1 million, and 36% believe they will have less than $500,000.

Millennials are the most optimistic about their anticipated household investable assets at retirement, with 17% believing they will see $2 million to $3 million, 22% feeling they will have $1 million to $2 million and nearly 40% believing they will have between $500,000 and $1 million. Forty-five percent of Gen Xers feel they will have less than $500,000, 34% say they will have between $500,000 and $1 million and only 14% say they will have between $1 million and $2 million. Females are less optimistic about their retirement situation than males, with less than four-in-ten feeling they will have less than $500,000 of investable assets upon retirement.

NEXT: Attitudes about investing and investment selection

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