Gen X, Worried about Retirement, Is Saving More
PITTSBURGH – The Great Recession was a wakeup call to Americans ages 35 to 49, often called Generation X, and they’re not only more worried than baby boomers about how they’ll finance their retirements, they’re saving more.
So finds a survey that PNC Financial Services Group Inc. commissioned, the results of which were released today.
“Members of Generation X tend to be more worried, are saving more and taking more responsibility for their nest eggs than baby boomers,” those born between 1946 and 1964, said Celandra Deane-Bess, senior wealth manager for PNC Wealth Management and chairwoman of its national practice group for retirement.
They also plan to retire, on average, at age 63.6 where boomers intend to work until age 65.5. Nearly all surveyed, 95%, agreed, “It is/was very important to me to retire when I choose/chose to.”
The survey showed that while 15% of respondents are coping with the effects of the Great Recession, seven in 10 changed their financial behaviors, just more than half, 51%, of Generation X is saving more for retirement compared to 37% of the baby boomers.
PNC commissioned Artemis Strategy Group to conduct “Perspectives on Retirement Survey” online between Feb. 13 and 25 throughout the United States on a cross section of 1,017 adults ages 35 to 75. Each participant was required to have assets that could be invested of at least $50,000 if between ages 35 and 44 and $100,000 if age 45 or older. One in five in the sample had assets of $1 million or more; and one in five is retired, but not necessarily the same one in five.
Survey findings are significant at the 95% confidence level with a margin of error of +/- 3.0%, PNC said.
Where more than half of the baby boomers expect they’ll need $1 million to retire comfortably, others thought they’ll need $1.3 million. However, PNC found, nearly three-quarters, 74%, have not accumulated $1 million.
Members of Generation X expect they’ll need $1.5 million.
Of those with assets they can invest of $50,000 or more, nearly two-thirds of Generation X, 65%, agreed with a statement on the survey, “I believe I am solely responsible for my retirement (no Social Security, employer pension, inheritance, etc.) compared to 45% of baby boomers.
On the other hand, “No matter what the age, an overwhelming number expect Social Security to be there for them,” PNC learned. “Ninety-four percent of all respondents agreed, “I have earned my Social Security through paying [FICA] taxes and therefore it is owed to me.”
Many in he survey said their 401(k) plans or Individual Retirement Accounts are insufficient to achieve their retirement goals, Deane-Bess said. On average, respondents invest 11% in their employers’ retirement plans and another 9% in addition to these plans.
Younger investors worry more than baby boomers about having a sufficient source of income between the time they retire and when they die. Nearly three-quarters, 73% of Gen Xers, agreed with the statement, “I worry that my savings will not hold out as long as I live.” Only 55% of boomers agreed.
Copyright 2017 The Business Journal, Youngstown, Ohio.
Published by The Business Journal, Youngstown, Ohio.
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