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Exploring the unique financial challenges facing Gen X

Gen X hit a special milestone in 2017 as its oldest members turned 50, putting retirement just around the corner. Unfortunately, research shows that most of Generation X may significantly underprepared for their golden years; and no, that’s not because Gen Xers have been “slacking.” In fact, it’s because they’ve been pulling double duty. Generation X is also called the Sandwich Generation, stuck between kids that can’t achieve financial independence and parents who lost their retirement savings during the Great Recession. The financial burden has driven Gen Xers into greater debt with less savings lined up for the future. The articles in this section are specifically targeted to helping Gen Xers understand their financial world. You can also find more information about Gen X financial trends at the bottom of the page.

6 challenges that Gen X faces in today’s financial landscape

#1: They’re taking care of their parents and adult children

A recent study found that nearly half (47%) of Americans in their 40s and 50s taking care of an aging parent at the same time they are financially supporting an adult child over age 18. It’s the reason Gen X gained the additional title of the “Sandwich Generation.” For all the labels of slackers that Generation X received, they’re now taking care of three generations, often in one house.

This creates a huge financial burden on Gen X households. About 15% of Gen Xers are financially support both a parent and adult child. That leaves little room for focusing on their own financial goals.

#2: They aren’t saving effectively for retirement

Not surprisingly, Generation X struggles to save for their own retirement. A 2017 study by Northwestern Mutual found that 37% of generation members say they’ve taken no steps to prepare for their financial future.

That’s a problem. As the study points out, Gen X is the first true generation that’s solely reliant on retirement accounts. Pensions are absolutely a thing of the past. This makes it imperative for Gen Xers to start saving early. However, 45% say they prefer not to concern themselves with retirement investing until later.

This is a recipe for a retirement nightmare. More Gen Xers will be forced to work longer or maintain at least part time employment in retirement. And that’s only if Social Security doesn’t get gutted before they reach their golden years.

#4: They still have student loans to pay off

The average student loan balance for someone in their 40s is still $30,000. Gen X is more likely to hold their own student debt longer. They also are footing PLUS loans for their adult children, as tuition continues to climb. So, rather than student loan balances going down, they’re going up.

That’s a serious issue as you hit middle age. Student loans were always supposed to be those debts that you paid off in your 20s and 30s. By your 40s, it’s supposed to be clear, so you have financial breathing room for things like homebuying and starting a family.

Having student loan debt while you work to prepare for retirement is creating a financial rock and a hard place. So, if you’re in Gen X and still have student loan debt to repay, you need to find solutions. The good news is that about 50% of borrowers overpay and have better ways to eliminate their debt that they’re not using.

#5: Gen X holds more of every type of debt

As if paying student loans in your 40s wasn’t enough, there’s more debt pretty much everywhere. They have more mortgage debt than Baby Boomers – $144,000 versus $90,000. They also have more credit card debt with $8,000 in average balances versus $6,000 for Boomers.

What’s more, Gen Xers are more likely to rely on credit cards to cover everyday purchases. About 20% believe in going into debt on everyday expenses versus just 14% of Boomers. Of course, if you’re supporting your Boomer parents, that’s probably a contributing factor in why you can’t balance a budget.

#6: Gen X is fairing okay with credit

According to NerdWallet, the average credit score for Generation X is 655. A “fair” FICO score ranges from 630-689. So, Gen X is comfortably within the fair range. The same study shows that Gen Xers use about 37% of their available credit (30% or less is good). And they are twice as likely as the Silent Generation to have payments that are more than 90 days overdue; that’s 40% likely versus 16%.

Still, fair isn’t good and lower credit scores mean higher costs to borrow. Basically, not only is Gen X carrying more debt, because of their credit they’re doing it at higher interest rates. That means higher costs over the time it takes to eliminate each debt.

What can Gen X do to achieve financial stability?

If you’re a member of Generation X, your prime directive is to find practical debt solutions. Carrying more debt at higher interest rates will only further delay saving for life goals and retirement. In order to get ahead, you need to focus on eliminating debt.

Luckily, you’re in the right place. offers solutions for credit card debt, student loans and tax debt. We can help you find solutions that will help you reach zero, so you can save for your own future, even as you support parents and adult children. Call us or visit our Solutions Center to get started.