The New Sandwich Generation

They witnessed the stock market crash during their 20s and, as established professionals, purchased homes at the peak of the housing bubble – left to experience the greatest economic slump since the Great Depression.

Arguably retirement for this transitional generation will be very different than for Baby Boomers.

But research by the Insured Retirement Institute indicates only one-third of Gen Xers are “very confident” they will have enough money to live comfortably as retirees.

“They are the new sandwich generation – supporting aging parents and young children simultaneously,” says Melissa Joy, financial planner at Center for Financial Planning, Inc. “This is a difficult balancing act emotionally and financially.”

Stuck between increased living expenses and a standstill in social security expenses, “If Gen Xers aren’t proactive in saving for retirement, meeting financial obligations solely with social security will be difficult – if it’s even available,” says financial attorney Leslie Tayne.

It’s up to Gen X to plan for retirement independently.

“The population is graying and healthcare costs are predicted to continue rising,” says Julia Chung, Wealth Strategies Practice Leader at Facet Advisors.

Baby Boomers capped off the last round of employer-sponsored plans, and government-sponsored programs are likely to be significantly depleted when Gen Xers retire.

There’s a tradeoff happening.

Gen X has led the way in work/life balance and workplace flexibility, but, Joy says, “This could lead to retirement sacrifices, especially for people working fewer hours or whose desire for flexibility caused them not to advance their careers.”

“You may need to alter or reduce your expectations for your retirement lifestyle,” she advises.

The good news?

Chung sees them planning a retirement that doesn’t rely on resources beyond their control, because they’ve never relied on them.

“I suspect most Gen Xers will manage quite well on their own,” she says, “because they’ve always had to.”

Bonus PINK Link: The New Generation at Work.

How are you preparing for retirement?

By Sarah Grace Alexander

“Doing the best at this moment puts you in the best place for the next moment.” Oprah Winfrey