The Gen X Guide to Retiring Well

Retirement Comes Into View

Americans born between 1965 and 1980 are members of Generation X. If this group includes you, you might feel it’s time to start preparing in earnest for retirement. While financial milestones like buying a first home may be behind you, a host of others remain on the horizon. Are you ready for them? If you’re not sure, you’re not alone. Research shows that 30% of Gen Xers are worried about their financial future. While almost 70% of Baby Boomers feel well informed about their financial situation, only about half of Gen X feels the same.*

One big complication: Many Gen Xers are members of the “sandwich generation,” meaning they need to juggle financial responsibilities for their children, aging parents and themselves. It can be challenging to prioritize your own retirement savings while tackling these other obligations.

This guide is a helpful look at how you can prepare for—and enjoy—moving on to life after full-time work. In it, we’ll:

• Address some common concerns around retirement to help you feel better informed and more confident in the transition. We’ll cover the basics of goal setting, assessing your current financial status and building a plan to reach your goals.
• Help you understand how to manage financial obligations to your children and aging parents.
• Walk you through potential behavioral patterns that can trip you up as you make investment decisions.
• Help you understand the potential benefits of using a financial adviser to reach your retirement goals and equip you for productive conversations with them, if you go that route.

*Source: Global Consumer Survey (Top 25% HHI), Statista survey data collected 10/04/2022 - 10/29/2023.

Defining Your Retirement Success

Every investor has their own idea of what a comfortable retirement looks like. Plan your post-career days based on your unique goals and financial situation, focusing on the things that are most important to you.

First, determine your goals and financial objectives. What do you want to do when your full-time working days end, and how much do you need to save? 

Next, understand your time horizon—the length of time you’ll need your money to last.

Then take stock of your current financial situation, including sources of income, how much you have saved already, your spending and your liabilities. Once you’ve figured out your goals, time horizon and current financial situation, you can assemble a plan to help you reach your retirement goals. 

Your Priorities May Include:

Preserving or enhancing your quality of life. You’ll probably need to grow your purchasing power if you want to keep your lifestyle as is or improve it.

Increasing your wealth. You might want your money to grow, possibly to build a financial legacy. In that case, your plan may emphasize preserving your current wealth while investing for growth.

Making sure not to run out of money. You may need to live off your savings for a long time, so you need a plan that helps ensure you don’t spend too much too fast.

Spending every last dollar. You may want to make the most of your wealth during your lifetime. If so, take extra care not to underestimate how long your assets need to last.

After considering your big-picture priorities, you can begin mapping out what you want your retirement to look like. 
 

Identifying Your Investment Time Horizon

This is the length of time you’ll need your money to last to achieve your goals. It may be equal to your lifespan or it may extend beyond that if you plan to leave a financial legacy. Your time horizon can have a big impact on your portfolio asset allocation—the mix of stocks, bonds and other investment categories you’ll need to reach your goals.