With all the attention paid to baby boomers, it’s hard to believe another generation is rapidly approaching retirement age. In 2015, the first wave of Generation X is turning fifty. And Gen Xers are taking retirement into their own hands. According to the recent Ameriprise Financial Retirement 2.0 study, an overwhelming majority of Gen X say they started saving and investing early for retirement. They’re also looking to redefine retirement. As this generation heads into their golden years, health, wealth and work are their top priorities.
Thoughts on Work
The Gen Xers see work as an important part of their lives. Half of the group is currently working to achieve financial stability (55%) while a third say they can’t afford not to work (33%). With retirement on the horizon, Gen X does not plan to say goodbye to work anytime soon. Instead, they plan to continue working in retirement, but in a way that is more meaningful than just earning a paycheck. Nearly 3 out of 4 survey respondents plan to stay in the workplace beyond retirement age in order to pursue something meaningful (73%).
Staying mentally and socially engaged tops the list of priorities for work in retirement. Gen Xers anticipate work at this time in their lives to be less stressful (50%), more rewarding (33%), socially meaningful (24%) and more interesting (18%). They see themselves possibly working part-time, as consultants or running their own business.
For the most part, this group seems to be taking ownership of saving for retirement, with 77 percent reporting they are taking steps to save enough to afford the lifestyle they want. In addition, 64 percent are investing with the goal of generating extra income for their retirement. Not everyone is on board, however. A minority of Gen Xers in this study say they haven’t really planned for their retirement (22%) and a few have not even thought about it (1%).
The majority of Gen Xers surveyed have taken advantage of an employer-sponsored savings plan. Eight in 10 report currently saving in a 401(k), while seven in 10 regularly put money aside in an IRA or similar account. Nearly one third of this group expects these savings to be a main source of income in retirement (29%). Far fewer respondents expect to rely on Social Security or pensions to help fund their new lifestyle-a significant change from previous generations.