For Gen X, reality bites when it comes to retirement

Gen X has a reputation for flying under the radar, but they need more attention and support when it comes to their retirement savings. 

Employees between the ages of 43-58 have the largest retirement savings gap of all groups, according to a new report from asset management firm Schroders. While they anticipate needing to save more than $1.1 million to retire comfortably, they expect to have around $660k in their retirement fund. Due to this gap, Gen X employees are the least confident in reaching what they consider their "dream retirement," compared to 49% of millennials and 53% of baby boomers. 

As retirement is getting closer and closer for Gen X workers, many of whom have less than a decade before reaching retirement age, it's critical they make efforts now to tighten the purse strings and recommit to saving for their future, says Deb Boyden, head of U.S. defined contribution at Schroders. 

"The size of the retirement savings gap facing Gen X is concerning, as they are the first generation to rely on 401(k) plans instead of pensions and are the next in line to retire," Boyden says. "Fortunately, even the oldest Gen X-ers have some time before reaching their full retirement age."

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Yet Gen X is not the only generation putting their savings to the wayside: While 45% of Gen X workers have done no retirement planning at all, that's in line with 43% of millennials who have avoided focusing on their future funds. Meanwhile, a third of boomers said they have not planned for their retirement at all. 

However, many boomers will have the benefit of a pension plan or other lifetime retirement income option, programs that have passed over the Gen X cohort. As such, 47% of Gen X-ers are concerned Social Security will run out by the time they need it, and 11% plan to wait until they're 70 to receive their benefits. 

"Gen X is the first generation not to have the safety net of a pension plan, and they missed out on automation features such as auto-enroll and auto-escalate for a good part of their savings," Boyden says. "Gen X workers should strive to max out their 401(k) contributions and take full advantage of the company match."  

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Closing that knowledge gap requires more effort on the part of employers, Boyden says. Providing that 401(k) match, as well as access to financial advisers that can customize a savings plan to each employee's individual needs is just the start. 

"Those who establish a plan and ultimately work their plan, establish greater financial stability," Boyden says. "Employers also have the opportunity to create flexible solutions that inspire longer accumulation periods with active risk management, as well as in-plan retirement income strategies that protect their savings while still allowing for growth in retirement." 

With the right guidance, Gen X can reduce their financial stress, too: Shroeders found that Gen X spend at least 1.5 hours per day worrying about money, almost double the time of baby boomers. Take action, Boyden stresses, before it's too late. 

"Gen X still has time to get on track for retirement," Boyden says. "But the time to act is now."