Three Gen X Retirement Mistakes for Millennials, Gen Z to Avoid
Many Gen Xers haven’t prioritized saving for retirement and face a crisis as the first generation to retire without substantial support from pension plans.


Dear Millennials,
To steal a phrase from my generation, please “do as we say, not as we do.” If you’re between the ages of 28 and 43, studies suggest you’re not likely prioritizing retirement planning. This isn’t groundbreaking news — the generation before you (Generation X) didn’t prioritize retirement savings when they were your age and, as a result, is now staring down a retirement savings crisis.
Why do I care? I work at an investment firm whose focus is to help people retire with dignity. I’m also a Gen Xer, which has provided me with a front-row seat to the missteps and miscalculations of my generation. With the years shrinking before we head into retirement, it’s my hope that the generations that follow don’t repeat what are becoming our all-too-clear mistakes.
From just $107.88 $24.99 for Kiplinger Personal Finance
Be a smarter, better informed investor.

Sign up for Kiplinger’s Free Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
By contrast, Gen X will be the first generation to reach retirement without the safety net of corporate pension plans, at a time when people are living longer. Our retirement years will be funded by what we can manage to save, principally in 401(k) accounts, and Social Security. How long these funds last will depend on how much we have saved, and many of us in Gen X are woefully unprepared.
How Gen X retirement accounts stack up
The National Institute on Retirement Security reported the average balance in 2020 for private retirement accounts among working Gen Xers was $129,994. The median account balance was far scarier — $10,000 — and a whopping 40% had zero balances!
Further, according to our Schroders 2023 U.S. Retirement Survey:
- 61% of non-retired Gen Xers are not confident in their ability to achieve a dream retirement.
- 84% of Gen Xers are concerned or terrified by not receiving regular employment paychecks in retirement.
- About half of Gen Xers (49%) are concerned about outliving their assets in retirement.
This is a cautionary tale for Millennials and Generation Z, who will also depend mostly on 401(k) plans for retirement funding. With the benefit of a longer time horizon, these generations have an opportunity to avoid the following mistakes:
- Not planning. Nearly half of all Gen Xers (45%) have not done any retirement planning.
- Not saving enough. Gen X reported on average they will need roughly $1.1 million in savings to retire comfortably, yet they expect to stop working with only about $660,000 saved — a yawning gap of about $450,000.
- Not taking full advantage of the benefits of stocks. Gen X on average reported having more retirement savings allocated to cash (32%) than equities (30%) — a significant opportunity cost for long-term investors.
So not only have we not planned or saved enough, but we’ve also robbed our portfolio of the potential higher returns that can be generated by stocks over several decades. Some lucky Gen Xers can alleviate these problems by aggressively saving more or, if able, working longer.
However, large numbers of Americans report retiring before we plan to, often for reasons outside our control (chiefly poor health, caregiving responsibilities and job changes). And this in and of itself has unexpected costs that speed up drawdowns in retirement accounts.
There’s still time for younger generations
Fortunately, Millennials and Gen Z have many more good earning years remaining to increase savings. A few time-tested strategies for enhancing your retirement readiness include:
- Max out your 401(k) contributions. Contributing the maximum permitted to your workplace retirement account enables you to reduce your income taxes, ensures you get the full employer match (if applicable) and increases the benefits of compounding, which can have a significant positive impact on account balances.
- Save in a health savings account (HSA). As one of the most tax efficient savings options available today, HSAs enable you to contribute pre-tax dollars, pay no taxes on earnings and withdraw the money tax-free now or in retirement to pay for qualified medical expenses.
- Hire an adviser. Working with a financial professional who can help set your goals and establish a path toward reaching them can be a difference maker. Our U.S. Retirement Survey found the average monthly income for retirees with a financial adviser and a plan is $5,075 compared to an average of just $4,170 across all retirees.
Those of us in financial services want to see our clients, along with our friends and neighbors, living as well as they possibly can while working, and in retirement. Yet, with my generation moving into retirement without corporate pension plan support, the data suggests our road will be more treacherous than the one traveled by past generations.
History has a habit of repeating itself, but it doesn’t have to. May the challenges Gen X faces spur the next generations to save more, invest well and better enjoy the fruits of their labors before time (and then money) runs out.
All investments involve risk including the loss of principal. Past performance is not a guide to future results and may not be repeated. Forecast may not be realized. The views shared are those of the author and may not reflect the views of Schroders Plc or any of its affiliates. Schroder Investment Management North America Inc, SEC registered, CRD Number 105820.
Related Content
- 16 Retirement Mistakes You Will Regret Forever
- Five Things I Wish I’d Known Before I Retired
- Retirees’ Anti-Bucket List: 10 Experiences You Don’t Want
- Five Common Retirement Mistakes and How to Avoid Them
- Spending Differences in Boomers vs. Millennials
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

As Chief Strategy Officer for North America and Head of the US Client Group for Schroders, global asset manager with $923.1B in assets under management, Tiffani’s role involves ensuring alignment of the firm’s key divisions and strategic offerings. As Head of the US Client Group, a dedicated team of 80-plus professionals across sales, business development, product, marketing and client experience, Tiffani’s position is crucial to the growth and development of Schroders’ North American business capabilities and clientele.
-
S&P 500 Hits New Highs as Rally Resumes: Stock Market Today
Tech stocks were the biggest gainers on Wall Street today, with Nvidia and Dell making notable moves.
-
The Shutdown Standoff Is Heading for Its Next Big Test
A key mid-October deadline could intensify the shutdown fight in Washington, and the fallout could soon hit workers and your wallet.
-
Preferred Bank Stocks: The Investment Retirees (and Others) May Be Missing Out On
Most large banks issue preferred stocks that pay out fixed dividends, often with higher yields than bonds. Should you make room for them in your portfolio?
-
Don't Let Your Equity Compensation Trip You Up: A Financial Expert's Guide
Stock options, RSUs and other executive perks can come with some serious strings attached. To avoid a nasty tax surprise, you need a plan.
-
The Spendthrift Trap: Here's One Way to Protect Your Legacy From an Irresponsible Heir
A spendthrift clause in an estate plan can protect an inheritance from a financially irresponsible child's debts and poor decisions.
-
Adapting to AI's Evolving Landscape: A Survival Guide for Businesses
Like it or not, AI is here to stay, and opting out could be disastrous for your organization. Instead, focus on what you can control and be flexible, as AI is still evolving.
-
Striking Gold (or Gas): A Financial Pro Unpacks the Nuances of Energy Investing
Investing in the energy industry, particularly oil and gas, involves understanding the facts about how projects generate returns through cash flow and long-term asset building, while also being aware of the risks.
-
Escaping the New Golden Handcuffs: A Financial Expert Has a Plan for Today's Executives
Feeling stuck in your job? It could be your complicated compensation package, but it also could be where you live, your family or even how you view yourself.
-
I'm a Financial Planner: Here's How to Invest Like the Wealthy, Even if You Don't Have Millions
Private market investments, once exclusive to the ultra-wealthy and institutions, have become more accessible to individual investors, thanks to regulatory changes and new investment structures.
-
Four Ways a Massive Emergency Fund Can Hurt You More Than It Helps
Saving too much could mean you're missing opportunities to put your money to work. Redirect some of that money toward paying off debt, building retirement funds, fulfilling a dream or investing in higher-growth options.