Those born between 1965 and 1980, known as Gen X, are at a pivotal crossroads.
This generation has faced unique challenges from economic turbulence, to rapid changes in the workplace. For many, retirement planning has been marked by uncertainty, competing priorities, and unexpected setbacks.
As a result, 48% of Gen Xers have not done any retirement planning. (1)
The good news? It’s not too late to take control. We’ll outline some steps to help you pave the way to a secure, fulfilling retirement.
Why Gen X Faces Unique Retirement Challenges
Retirement planning for Gen X hasn’t been a smooth journey.
Many Gen Xers have had to manage increasing living expenses without corresponding income growth.
Debt burdens with mortgages, loans & credit cards have limited opportunities to save significant amounts, and the rise of healthcare costs with uncertainty about the future of social security only add to the stress of retirement planning.
Despite these obstacles, Gen Xers have opportunities and can take proactive steps to address them.
Retirement Secrets You Aren’t Supposed to Know About
Step 1: Find Your Financial Footing
In order to build a strong retirement plan, you need to start by understanding your current financial position.
Evaluate Your Net Worth
Compile a list of your assets, such as savings, investments, and property, then subtract your liabilities, like credit card debt and loans. This will offer a clear snapshot of your financial health, helping you identify strengths and pinpoint areas that may need improvement.
Review Your Savings
Review your 401(k), IRAs, and other retirement accounts, and compare your current savings to the amount needed for a comfortable retirement. To determine this, estimate your future expenses, evaluate your expected income, and create a plan to bridge any gaps. If you’re not there yet, don’t worry — there’s still time to make adjustments.
Identify Financial Leaks
Keep tabs on your spending and identify areas to cut back. For example, consider skipping the daily coffee shop run, reviewing your insurance policies to avoid overpaying, or exploring more affordable travel options.
Step 2: Define Your Retirement Goals
A clear vision of your ideal retirement makes planning more purposeful and motivating. It’ll also help make things a little less overwhelming once you know the direction you’re wanting to head in.
Envision Your Future
- Where do I want to live/move to?
- How much, and where do I want to travel?
- What hobbies or activities will I pursue?
Estimate Your Expenses
- Essential expenses: Housing, utilities, and groceries.
- Healthcare costs: Anticipate increased medical expenses as you age.
- Lifestyle spending: Travel, hobbies, and entertainment.
With a clear picture of your ideal retirement and a realistic estimate of your expenses, you can start to build a roadmap that’s tailored to your goals.
Step 3: Boost Your Savings
If you’re behind on saving, there are a few ways to try and catch yourself up.
Maximize Catch-Up Contributions
If you’re 50 or older, now’s the time to make use of those catch-up contributions. In 2025, you can stash an extra $7,500 into your 401(k) and an additional $1,000 into your IRA each year. These extra dollars can make a big difference down the road as they continue piling up. (2)
Automate Savings
Being consistent is always a good trait to have when building wealth. Automate those contributions to your retirement accounts so you’re always growing your nest egg — no second-guessing required.
Diversify Your Investments
Diversification isn’t just a buzzword; it’s your safety net, helping to manage risks while keeping your growth potential strong. Aim to create a well-balanced portfolio of stocks, bonds, and other assets that doesn’t pigeon-hole you into one specific area of the markets.
Reduce Debt
You probably know how easily high-interest debt can drain your resources. Focus on paying off those credit cards and other costly loans. The less debt you have, the more you can funnel into your retirement goals.
Step 4: Plan for Healthcare Costs
Healthcare often ranks as one of the biggest retirement expenses, but planning ahead can help you manage these costs and reduce stress.
If you’re enrolled in a high-deductible health plan, an HSA (Health Savings Accounts) is a powerful tool. It allows you to save for medical expenses tax-free, and any unused funds roll over year after year. By the time retirement rolls around, this account can become a legitimate financial safety net for healthcare costs.
Know that those long-term care services — like nursing homes, assisted living, or in-home care — can get pretty expensive.
Think about investing in a policy earlier to lock in lower premiums and have that peace of mind knowing you’re covered for future needs.
It’s not the most comforting subject to deal with, but planning for healthcare ahead of time will better equip you, your health, and your savings.
Step 5: Diversifying Your Income
Multiple income sources can provide added stability during retirement, depending on what your current work situation is.
Delay Social Security Benefits
While you can claim Social Security as early as age 62, delaying benefits until age 70 can significantly increase your monthly payouts.
If you start receiving benefits at age 62, your monthly payment will be reduced by about 30% compared to waiting until your full retirement age (which is 67 for those born in 1960 or later) (3). On the other hand, for every year you delay taking your Social Security benefits past full retirement age up to age 70, you get a bump of 8% in your benefits. (4)
Embrace Part-Time Work
Explore part-time roles, freelance gigs, or consulting opportunities to supplement your income. Not only does this keep your finances strong, but it also helps you stay active and connected, perhaps to something you’ve had an underlying interest in.
Read our blog post for more tips on building a proper retirement income plan.
Step 6: Stay Agile & Adjust
Know that retirement planning unfortunately isn’t a “set it and forget it” process — it requires regular updates & careful attention.
Be sure that you’re checking in with your retirement plan on a consistent basis to review your savings, investments, and spending. Make adjustments to stay aligned with any lifestyle changes, market conditions, shifting goals, etc. In that same vein, be sure to stay informed about updates in tax laws, Social Security, and new investment opportunities.
For Generation X, the time to take charge is now. It’s never too late to start saving, planning, and adjusting your strategy. While the challenges may seem daunting, the steps outlined above can help you create a strong foundation for a secure and rewarding retirement.
What actions will you take to secure the future you deserve?
