40-somethings are falling behind both their children and their parents when it comes to money

Luis Alvarez/Getty ImagesNearly half of Gen Xers say they’re living paycheck to paycheck.
  • Generation X employees are less likely to be confident in their financial situation compared to millennials and baby boomers, a MetLife study found.
  • Nearly half of Gen Xers say they’re living paycheck to paycheck, and only 53% have an emergency fund.
  • Employees of all generations say personal finances is their top stressor – a primary concern is their ability to afford retirement.

American 40-somethings have less confidence in their finances compared to other generations, a recent survey from MetLife revealed.

About 60% of employees who belong to Generation X reported being confident in their finances, while 65% of baby boomers, and 67% of millennials said the same. Pew Research Center defines Gen X as Americans aged 39 to 54 in 2019, accounting for one-third of the overall workforce.

While employees of all generations name personal finances as their No. 1 stressor, Gen Xers on the whole fall short when it comes to savings, according to the MetLife survey, and it’s contributing to their unhappiness at work.

Just over half (53%) of Gen Xers report having three months worth of salary socked away – money that could be used as an emergency fund – compared to 60% of baby boomers and 58% of millennials. What’s more, 48% of Gen Xers said they’re living paycheck to paycheck.

Overall, Gen Xers appear fairly pessimistic about retirement, according to the MetLife survey, which found 55% of Gen Xers reported feeling either significantly or somewhat behind on their retirement savings timeline. Overall, 18% of the cohort does not plan to retire at all. That’s compared to 12% of baby boomers and 14% of millennials.


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Among all employees surveyed, the biggest sources of long-term financial concern were the ability to afford the cost of healthcare in retirement, outliving retirement savings, and the ability to rely on Social Security and Medicare.

In a separate survey conducted by Bank of the West last year, every generation identified retirement as one of top three key ingredients of the American Dream. Interestingly, Gen X placed equal emphasis on retirement and homeownership being their top priorities, followed by being debt-free.

Data from the Minnesota Population Center’s 2017 ACS Integrated Public Use Microdata Series could explain why some members of Gen X feel unsatisfied with their financial situation. As Business Insider’s Andy Kiersz reported, a snapshot of salary data from 2017 show incomes tended to gradually increase with age for workers in their 20s and 30s (today’s millennials). After that, incomes plateaued between $US50,000 and $US55,000, until rising again for workers in their early 60s (today’s baby boomers).

Frequent salary raises may lead people to feel more financially secure, and in an ideal world, encourage them to save more money for both emergencies and retirement. Meanwhile, years of salary stagnation coupled with their highest spending years, including raising kids and paying for college, could erode financial confidence.

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