Helping Gen X With Financial Wellness

Generation X has competing financial priorities that plan sponsors need to address.

By Rebecca Moore | May 31, 2017
Page 1 of 2 View Full Article

While Millennials and Baby Boomers get much attention, it could be argued that Generation X is the most in need of financial wellness help.

For Gen Xers, according to Larisa Terkeltaub, senior director of LearnVest at Work, aside from credit card and student loan debt and saving for emergencies and retirement, there’s an additional layer when it comes to prioritizing competing goals. Many parents tend to put their family’s needs, such as paying for their children’s college, ahead of saving for their own retirement and accelerating their debt repayment. Parents strive to provide their families with everything they need, which at times can come at the cost of their own savings plan.

Monika Hubbard, AIF, institutional retirement consultant at Unified Trust Company, who is based in Louisville, Kentucky, says, “Millennials get all the press, probably because they are the digital generation, which is unique to them,” she says. “In addition, the wealth transfer from Baby Boomers will be mostly to Millennials—about $30 trillion—and interest follows money.”

According to Hubbard, Gen X’s top worry (56%) is not having money for short term financial needs. The second worry for Gen X is not having enough for retirement. Also, cash management and debt management are worries (45%).

Terkeltaub says in many cases, Gen Xers are more likely to be able to focus on goals above and beyond their basic financial security. Gen Xers who have established strong financial footing are better able to dream up what their next financial achievement may be.

Hubbard says Unified Trust Company is seeing Gen X turn to topics correlated to their stress; debt management seems to be a first priority. Gen X is asking, “How do I manage money—reduce credit card debt and improve my credit score while managing day to day expenses?” she says.

“We always tell them to save early and save more, but if the average debt for student loans is $10,000 to $15,000, and they have to pay for living expenses, they think, ‘How can I save enough to get the company match when I don’t have money for current expenses?’” Hubbard says. She adds that Generation X also worries more about breaks in service or change in jobs, unlike the Baby Boomer generation. They have to make sure they can deal with something that happens in the short term.

NEXT: How Plan Sponsors Can Help