Why Gen Xers are setting the stage for rethinking retirement

VaselineOctober 9, 2024

0 3 minutes read

Why Gen Xers are setting the stage for rethinking retirement

As the oldest members of Generation X approach their 60s, retirement decisions are moving to the fore. Many Gen Xers have spent decades carefully saving and investing for their retirement, but even those who have kept a close eye on the savings register are beginning to wonder if their retirement dream will come true.

In 2024, 71 percent of Gen Xers are considering delaying retirement, up from 65 percent in 2023, according to a recent survey from F&G. Almost half (49%) said they were worried about not having enough money for retirement. But even amid the volatility and uncertainty, there are steps Gen X can take to alleviate these concerns.

Retirement considerations for a new generation

It’s no secret that retirement looks different for everyone, and today’s generations approach it with more consideration than their parents and grandparents. Whether it’s continuing the intellectual challenge and stimulation that comes from work, as I did, or pursuing new passions, the concept of retirement can look different for current and future retirees.

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It’s important to remember that retirement planning is not a one-way journey. The traditional path our parents and grandparents took may not align with Gen X’s personal aspirations or evolving life circumstances.

That’s not to say there isn’t an abundance of retirement planning knowledge that baby boomers (both older and younger ones like me) can pass on. However, it’s important to remember that Gen Xers require personalized advice related to their unique financial challenges and aspirations. This type of advice is not always transferable from one generation to the next.

How carefully Gen X can protect their nests

This is a crucial time for Gen Xers to shift their focus from simply accumulating wealth to strategically planning the distribution of their savings as they enter retirement. While this generation is tech-savvy and often has a do-it-yourself ethos, I think they would also be well served by supplementing their expertise with a professional financial coach who can discuss both their personal financial goals and the products that can help transform those. objectives in reality.

Particularly attractive but often overlooked options for Gen Xers to consider are annuities, which can allow investors to pursue growth potential with an added layer of protection. Notably, our survey found that less than a quarter (19%) of Gen Xers own an annuity.

Annuities can take pressure off a portfolio while providing peace of mind that people won’t outlive their savings. With the traditional corporate pensions many of their parents relied on now a thing of the past, annuities can offer Gen X an opportunity to create their own retirement-like income. These products are also suitable for weather inflation and stock market volatility.

They are a good fit for a generation that has lived through a series of global volatility, including the dot-com boom and subsequent bust of the 1990s, the 2008 financial crisis and, most recently, a pandemic and concerns about inflation that is just beginning to appear. slowly now With that in mind, it’s no surprise that Gen Xers have persistent fears of volatility in their minds. In fact, we found that nearly half of Gen Xers continue to worry about inflation (47%), in addition to a recession or stock market decline (31%).

Why Gen Xers Should Consult an ‘Xpert’

I recommend that people consult a financial advisor before purchasing an annuity or any financial product. Financial advisors are critical partners who can ensure that the products people invest in will meet their financial needs. However, according to our study, only half of Gen Xers currently work with a financial advisor. For those looking for security and certainty, financial advisors can help put them on the path to a guaranteed income and a less stressful retirement.

But no one should expect a financial advisor to do all the work for them. It is important that people come prepared to any conversation with their financial advisor. Online tools like retirement savings calculators, budgeting tools, and investment tracking apps can give people the data they need to ask the right questions and make sure both they and their financial advisor are on the same page.

Retirement is not just a number: it has different meanings for everyone. By addressing financial issues now, Gen Xers can clarify their unique vision for retirement and put themselves on the path to achieving their ultimate goals.

Note: The F&G survey was conducted online by Directions Research and conducted between May 1 and May 16, 2024, among a nationally representative sample of 2,048 US adults. Respondents were targeted to Americans 50+ who are financial decision makers who have over $100,000 in financial products/savings.

This article was written by and reflects the views of our contributing advisor, not the Kiplinger editorial staff. You can check advisor records with help dry or with FINRA.

VaselineOctober 9, 2024

0 3 minutes read

Retirement considerations for a new generation

Vaseline

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