Dive Brief:
- Retirement seems to be out of reach for many Gen X workers: 19% of Gen Xers don’t expect to ever fully retire, according to a Zety report released Wednesday, with another 19% planning to work well past 68 years old. Zety surveyed over 1,000 Gen X workers for its generational finance report outlook.
- Why are retirement dreams slipping away? The majority of respondents blamed the current state of inflation, more so than COVID-19’s economic disruption or the 2008 financial crisis.
- Per the report, Gen Xers are adjusting their financial behavior accordingly. However, there is still an opportunity for HR to step in and help workers feel empowered heading into retirement, according to a retirement expert.
Dive Insight:
Zety highlighted how the current state of the economy makes “day-to-day survival a challenge” for many Gen Xers: 36% told Zety their income just covers their expenses, and 22% said their income does not stretch far enough to do so.
In response, Gen Xers are finding ways to take control of their finances. Nearly half said they are reducing their spending, 35% are working on their debt and about 34% are increasing their savings or contributions. About a quarter are boosting their income through a side hustle, and a small number of respondents said they are revamping their investment strategy.
Overall, more than half of Gen Xers said they’re worried they haven’t saved enough for retirement. How can HR fill in the gaps?
Benefits education or lack thereof seems to be a recurring theme in retirement conversations, especially from an HR standpoint. Only about half of working people, according to an analysis of U.S. Census Bureau Survey of Income and Program Participation data, are engaging with their employer-sponsored retirement plans.
“At a time when Americans are facing a growing affordability crisis, we need to recognize that retirement should be part of that conversation,” the director of the National Institute on Retirement Security said in a statement earlier this year. “Most retirement programs today rely on workers saving voluntarily, with the tension between saving and the cost of buying a home, daycare, and college creating enormous challenges for the middle class.”
Referencing NIRS’ own research, the director said these findings demonstrate “the fragility of both the nation’s retirement infrastructure and retirement preparedness for the typical U.S. household.”
Still, even the workers that receive trusted financial guidance from employer-provided resources may still lack the confidence to retire: 62% of respondents told Aon-owned insurance broker NFP that one-on-one meetings with financial professionals were helpful, but 69% of respondents still said they are unsure they can retire comfortably in NFP’s 2026 U.S. Retirement Trend Report.
Another report suggested that nearly half of working adults in the U.S. feel that they would need $1 million to comfortably retire. Ultimately, as the NIRS director told HR Dive, HR will need to help employees have realistic expectations for retirement.