Allianz Life Insurance recently reported the results of a study of the views of Generation X toward retirement. What's interesting about their study is that while members of this generation share with Baby Boomers a skeptical and troubled view of their retirement prospects, the percentage so believing is even higher than that of the Baby Boomers. A traditional retirement is now considered a "romantic fantasy of the past", for 84% of those Generation Xers polled by Allianz. More than two-thirds of those surveyed thought that retirement savings targets were "way out of reach" and that they will "never have enough money to retire".
Many young people and even pre-retirees tend to dismiss the grim state of their own retirement funding, believing that they will simply work forever. In fact, expectations of the age of personal retirement are rising, with 37% now indicating they plan to work past age sixty-five, versus just 14% in 1995. However, while Americans think of age sixty-five as the typical retirement age or that they might work well past this age, in practice, we retire much earlier than this, a full four years earlier on average, with early retirement often brought on by health reasons or layoffs.
But perhaps of even greater concern for Generation X is that 89% of those polled reported difficulty saving money, while more than half of respondents claimed they "just don't think about putting money away for the future". The most troubling part of the study, however, is that while Gen X is skeptical about their prospects for retirement, 85% also report concerns about the difficulty of keeping a job. Call them Generation Worry.
The truth is, there is still much time for this generation and the millenniums to adjust their lifestyle, spending and savings habits to provide for retirement. While each generation would like to believe this day will never come, as John Lennon so famously said, "Life is what happens when we're busy making other plans". This day will come and with Social Security in desperate shape, corporate pension plans greatly diminished and public employee pension plans suffering startling under-funding, some level of personal planning and public awareness of this issue is well advised.