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Biggest Obstacles Gen X Faces in the Future

By Adem Selita

Student Loan Debt

Although comparatively speaking Generation X has less in outstanding student loans than later generations, student loan debt still remains a significant headwind for them. Student loans can be a major handicap to anyone’s budget and can significantly weigh on a consumer’s debt to income. Therefore affecting their ability to own a home or make other major purchases, etc.

Sandwich Generation

Many generations Xers are stuck in the middle! They are caught between helping their older parents and raising their own children/family. This tends to limit financial progress and the ability of many Xers to save. Since they are stuck in this middle area they spend a lot of time juggling and can often feel left behind in terms of making substantial financial progress.

Lack of Financial Literacy

Although financial literacy is promoted more now in the education system than in previous years, this wasn’t the case when Gen X was in school. This has led many Gen Xers to simply figure it out of their own accord and for many that has led to a multitude of financial mistakes and mishaps.

Retirement Plan Shortfalls

Traditional retirement plans like pensions have become less and less common. Gen X again has been caught in a transitional period where shifting work dynamics and retirement planning has forced them to rely on individual accounts. To compensate Generation X should contribute to their own individual retirement plans as much as possible (both IRAs and 401ks whenever possible).

Higher Cost of Living

Generation X has been faced with significant cost of living and inflationary headwinds. Housing, education and healthcare costs are all near all-time highs. In order to compensate, Generation X has had to forego contributing to retirement plans as much as they may have liked.

In order to prepare for the future generation X needs to take proactive steps in financial planning and investing.

  • Take advantage of employer matches in retirement contributions
  • Consider contributing to Roth IRA for tax free growth
  • Focus on paying down debt and reduces interest liabilities wherever possible
  • Automate savings and diversified investment strategies
  • Seek professional advice from Financial advisors/planners/CPAs.