Gen Xers, often sandwiched between caring for kids and parents, are facing significant challenges in saving for retirement. This generation finds itself in a unique dilemma, with financial obligations taking a toll on their future plans. Steve Mullen's story is just one example of the stress and worry that many Gen Xers experience.

Gen Xers' Retirement Dreams Shattered by Caregiving Burden

Financial Strain and Caregiving

Many Gen Xers are caught in the middle, caring for both their children and parents simultaneously. This dual burden has led to financial strain, as seen in the statistics. Nationwide found that 56% of Gen X investors were financially supporting either their parents or kids. The financial burden has some Gen Xers doubting if they'll ever be able to retire.For instance, Steve Mullen, 54, is pulled in three directions. He and his wife provide up to 40 hours of caregiving per week and spend tens of thousands of dollars over decades for their mothers. At the same time, they support their college-age son with housing and tuition. The constant worry about money adds to the stress.

Impact on Retirement Savings

Gen Xers in caretaking roles are more likely to show signs of financial strain. According to the Nationwide study, 21% of those taking care of a child or a parent had taken out significant amounts of debt, and 20% were unable to save for retirement. A separate survey by Carewell found that 75% of those caring for both a parent and a child struggled to save for retirement, while 63% lived paycheck to paycheck.Julie, a woman in her fifties from Ohio, spent over $100,000 caring for her mother over 15 years and has less than $70,000 saved for retirement, far below the recommended amount. This shows how caregiving has set them back in their retirement savings.

Compared to Other Generations

By some measures, Gen Xers are even more ill-prepared for retirement than baby boomers. According to Prudential Financial surveys, the median retirement savings for 55-year-olds is just under $48,000, with 18% having saved nothing. Two-thirds of 55-year-olds are afraid of outliving their savings, which is the highest level among any age group.Joe Wadford, a Bank of America economist, believes Gen Xers are uniquely burdened by caring for both parents and children at the same time, due to more children living at home. Market crashes during their formative years also contributed to less savings.

Uncertain Future and Government Funds

The outlook for Gen X remains uncertain. Social Security could be depleted as early as 2033, when most Gen Xers are already retired or in their final decade of work. While boomers are estimated to pass on around $80 trillion in wealth, most of it is likely to go to millennials, not Gen X.Brandon Goldstein, a financial planner at Prudential, believes many Gen Xers still have time to catch up but may have to work longer than they want. More older Americans are already deciding to postpone retirement, with 19% of adults 65 and over still employed in 2023.In conclusion, Gen Xers are facing a tough battle in saving for retirement due to their caregiving responsibilities. The financial strain and uncertain future make it a challenging time for this generation.