According to the Tenth Annual 2024 Advisor Authority Study conducted by the Harris Poll for the Nationwide Retirement Institute®, Generation X investors ages 44 to 59 are facing difficult financial conditions. After living through previous financial crises and now balancing dual caregiving roles for children and aging family members, Gen X investors are feeling significant financial strain.
The Nationwide study found that more than half (56%) of Gen X investors currently provide financial support to their parents or children. This responsibility has earned Gen X the nickname of “the Sandwich Generation.” A big challenge for the Sandwich Generation is that they often put the needs of their loved ones above their own, leaving them in a potentially precarious financial situation that can have long-term implications.
Among them, more than 1 in 5 (21%) report taking on large levels of debt to manage this responsibility. To meet these financial commitments, a quarter (24%) of Gen X investors are taking on credit card debt, while more than a third (35%) are reducing nonessential expenses.
The financial responsibility of supporting both parents and children is also taking a toll on Gen X investors’ retirement savings. 1 in 5 (20%) report being unable to save for retirement, while 23% have reduced or halted retirement savings due to supporting their children and/or parents. What’s more, 16% have tapped into retirement accounts or investments to manage these financial pressures.
Beyond family responsibilities, broader economic factors are also compounding retirement challenges for Gen X investors. Gen X investors have shouldered the impact of major economic events, from the dot-com crash in 2000 to the Great Recession in 2008, while also entering the workforce just as pensions were being phased out, leaving them responsible for building their own retirement savings. Though these experiences have built resilience, 1 in 4 (26%) nonretired Gen X investors feel they will retire later than planned because of inflation, with more than 2 in 5 (44%) expecting to retire at age 66 or later. This prediction contrasts with the EBRI 2024 Retirement Confidence Survey which showed a median retirement age of 62.
With retirement obstacles mounting, many Gen X investors feel as if they have a long way to go to reach retirement readiness. 1 in 5 (20%) believe they would need $2 million or more in retirement savings to feel comfortable about their financial future. However, only 7% report saving that amount, and just 16% report having half that amount saved ($1 million). Alarmingly, 3 in 10 (30%) report having less than $100,000 saved for retirement.
For those Gen Xers struggling financially, it’s not too late to get back on track with the right long-term plan — and for that, they may be looking to plan sponsors for assistance.
Despite pessimism, Gen Xers embrace pragmatism
Having weathered significant economic events during their careers, it’s not surprising that Gen Xers are the least optimistic about their financial outlook over the next year (36%), outpacing Gen Zers (40%), baby boomers (45%) and millennials (49%).
However, Gen X investors are taking proactive steps to prepare for potential near-term volatility. 6 in 10 (60%) of pre-retiree (ages 55 to 59) Gen X investors have adjusted their portfolios in response to high inflation, and 67% report having sufficient savings to survive a potential recession in the next 12 months. Despite these efforts, 1 in 10 (10%) say they struggle to afford basic household expenses such as groceries and utilities.
Nationwide offers resources to help plan sponsors support participants’ financial needs
Gen X investors are increasingly seeking financial guidance as they address their financial concerns. Nationwide’s suite of retirement and financial wellness capabilities are designed to support plan sponsors’ efforts to engage participants on personalized paths to financial wellness, now and for the future.
