The oldest members of Generation X will turn 59 1/2 this month, the earliest age at which workers can withdraw retirement funds without penalty. But many Gen
Gen But the 401(k) puts the responsibility squarely on participants to figure out how much to save, how to invest, and how to withdraw their money in retirement—a do-it-yourself approach which renowned pension expert Teresa Ghilarducci has described as thin.
That has left Gen said Natixis, an investment bank. The average retirement savings of Generation X households is about $150,000 – far from rough $1.5 million that Americans say they should retire comfortably.
What Gen X has in common with Jan Brady
Gen “They were the kids who were left alone after school, and even now that they’re retired, they’re kind of on their own.”
About 1 in 5 Gen And about a quarter are concerned that a shortage of savings will force them to return to work after retirement.
Other recent studies have also found that Generation X is in bad shape for retirement, at the National Institute on Retirement Security find earlier this year that the typical Gen X household with a private retirement plan has $40,000 in savings. About 40% of the group has not saved a cent for their pension, the survey showed.
Still, that hasn’t stopped Gen Xers from dreaming of retirement, with survey participants telling Natixis they plan to retire at age 60 on average. They also think their retirement will last about 20 years – shorter than what many retirees actually experience.
Such expectations may seem contradictory, especially given the lack of retirement savings they will need to finance their older years. But Goodsell chalked up the conflicting views on retirement, with half of Gen
“What I also see is that 48% of the people in the survey simply stopped thinking about it [retirement]Goodsell noted. ‘I interpret it as a sign that they are stressed. But burying your head in the sand is not a good strategy for anything.”
Many are too optimistic
Gen At the current inflation rate of approx 3.3%, that would imply an investment return of 16.4% – well above the typical annual return of around 10% for the S&P 500.
Meanwhile, only about 2% of Gen Xers understood key aspects of bond investing, such as the impact higher interest rates have on bond prices, the analysis found.
“For a lot of people, it’s a matter of thought when they think about investing,” Goodsell says. His advice to Gen Xers is to “learn as much as you can, and be realistic about what you can achieve.”
Still, Goodsell notes that some aspects of retirement are beyond employees’ control, which can increase people’s anxiety. About four in 10 Gen
A 2018 study from the Urban Institute, which followed workers from their early 50s through at least age 65, found that the majority had to stop working before reaching retirement age, with 28% quitting after a layoff, while another 9% retired due to poor conditions. health. Only 19% said they would retire voluntarily.
