Help Needed to Curtail Gen X’s Anxiety About Retirement

With competing financial priorities, Generation X can benefit from automated savings, savings education and access to a financial adviser.

Generation X investors are less confident about their financial future than Millennials or Baby Boomers, according to E*TRADE’s quarterly StreetWise survey.

Not having enough saved for retirement tops the list of worries for Gen X (ages 35 to 54), with nearly one-third (32%) choosing it. For Baby Boomers (ages 55 and older) and Millennials (ages 25 to 34) the top worry is the loss of a loved one, while not having enough saved for retirement ranks second for Millennials and third for Baby Boomers.

The survey also found four in 10 Gen X investors (37%) said they have taken an early retirement withdrawal, an increase of 10 percentage points in the past five years.

Mike Loewengart, vice president of Investment Strategy at E*TRADE Financial, stressed the importance of automatic savings for helping Generation X save more for retirement and feel more financially secure. In addition, he noted that employees should be encouraged to contribute at least enough to employer-sponsored retirement plans to get the full employer matching contribution.

However, with their competing financial priorities, Gen X investors are prime candidates for the help of a financial adviser. According to E*TRADE, Gen X investors are less likely than other generations to seek the help of an investment professional when it comes to managing their finances. Gen X investors tend to have more complex financial challenges, managing both their own wealth and that of their dependents. Offered access to an adviser, they can create a comprehensive financial plan—with a financial adviser acting as a coach to help prioritize, budget and allocate appropriately for the future.

Members of the sandwich generation, those between the ages of 36 and 60, are hard pressed to save for retirement or emergencies, primarily due to the strain of supporting other family members, according to a survey by PNC Financial Services Group. Thirty-eight percent do not have an emergency savings fund, 31% have an emergency fund that would last less than six months, 32% have less than $25,000 saved for retirement and more than half have $100,000 or less saved for retirement.

“While the financial challenges Millennials face are often in the spotlight, like student loans and health care costs, Gen X not only faces these, but also the compounding challenges of mortgages, financing education for their kids, and even managing their children’s and parents’ finances. Yet despite this perfect storm of financial challenges, they still have time on their side,” Loewengart says.