The oldest members of Generation X are turning 60 this year, but many of them are not confident that their retirements will be just like heaven.
Data from Cerulli released in September showed that four out of five Gen X 401(k) participants don’t expect they’ll be able to maintain their current standard of living in retirement, and two-thirds of them have less than $100,000 in individual retirement assets, according to Cerulli. Gen X covers people born between 1965 and 1980, so there’s a wide range of ages, from those turning 60 this year to those who are 45. Education and outreach to this generation, which is known for being independent but also pragmatic, is critical to help them boost their savings. For advisors, working with these individuals can give a needed boost to their retirement readiness, and help provide clients with added value.
Matt Waters, partner and wealth advisor at Prime Capital Financial whose firm also works with plan sponsors, said the No. 1 thing he tells 401(k) investors is “just get started.” If participants are saving but at low levels, he’s found success with encouraging gradual increases, such as increasing savings rates by 1% every time someone gets a raise or bonus, or to mark their calendar to annually remind the person to increase their savings.
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