Last updated on March 30th, 2025 at 06:41 pm

If you’re part of Generation X, retirement isn’t as far away as it seems. In just 20 years, you could be relying on your savings — or worse, only Social Security. And that’s a scary thought.

Here’s the reality check: Right now, 30% of Gen Xers expect to fund their retirement primarily with Social Security. According to the Social Security Administration (SSA), the median per capita family income for Gen Xers at age 67 is projected to be $46,000. Out of that, Social Security is estimated to provide just $16,000 annually — that’s only 35% of your income.

Imagine trying to cover your rent, groceries, medical expenses, and everything else on just $16,000 per year. Sound impossible? It probably is.

But here’s the good news: You still have time. The key is to take action now. Whether it’s maxing out your 401(k), opening an IRA, or exploring new investment options, every move you make today brings you closer to a secure retirement.

This article will break down what you need to know, step by step, so you can stop procrastinating and start planning. Your future self will thank you.

Let’s get started.

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"Gen-X only 20 years to retirement get planning now" is #1 in Generation X 20 Years to Retirement Series. Read all of the articles by clicking on the button at the bottom of this article and join our interest list for a new educational course "Generation X Preparing for Retirement"

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Some key topics covered in the Gen-X Only 20 Years to Retirement series:

• About retirement - the idea of leaving your career, how the actual process works, and more.
• Lifestyle - adjustments include about all that time you may have to fill.
• The planning process - includes many sub-topics
• Relocation - Consider relocation to reduce your expenses and increase your standard of living
• Budget - This is a big one. You will have access to our exclusive budget tool, a ground-up detail-oriented system
• Social Security - Strategies to consider include how Medicare works when you qualify, and more.
• Savings - Everything 401(k), Roth IRA all retirement savings accounts, and more
• Investing - including in real estate
• Credit Card - debt and other debt to control your expenses and financial obligations
• Wills and Trusts - what will happen to your savings when you are gone?

As with all generations, some are older Gen-Xers and younger Gen-Xers. For purposes of our whole series, we are basing calculations on a Gen-Xer who is 50 years old. The series focuses on age 70 for a 20-year time period between now and retirement.

Our tools can be adjusted to any age or retirement date

You will have the opportunity to make adjustments to some of the tools included in the series for your actual age. Basically, you have plenty of time to start today with your planning.

I have written about the Baby Boomers who are mostly retired or entering retirement and I have produced a series for Millennials. Baby boomers are already dealing with issues that you will have plenty of time to understand and do a better job than they have. Millennials are just behind you and they have even longer to build wealth. None of this is your concern, that's why this series focuses on you and others in your generation.

Gen X'ers did not attend retirement classes in high school or college. Their parents are Baby Boomers many of whom received the last of the defined benefit pension plans. Why would the Baby Boomers teach their children what to do for retirement since they were probably set up for retirement? Where would you learn what to do about retirement?

Gen-X's target retirement age is 70

If you want a successful retirement with a comfortable lifestyle, you need the benefit of information and lots of it. There are many decisions to make over the next few years. As I mentioned above, we are looking at age 70 which is the full retirement age to maximize your Social Security Benefits.

The series will include tools in the form of spreadsheets, tables, and other data. Unlike several articles I have looked at regarding retirement, you will not be referred to a dozen other sites to gather more information. If it seems that the topic is too big to cover in a single installment, we will break it down into smaller ones.

There is a strategy for everything related to retirement. Early withdrawals from a traditional IRA, Roth IRA options, and much more are just in the finance area. Then there is the Social Security Administration and all of the issues related to when and if, how much, etc.

Only 42% of Gen Xers have a written retirement strategy

The vast majority of Gen Xers do not have a retirement plan according to knowledgeable sources. Transamerica an insurer and provider of retirement services has taken a survey of Gen X workers. They have found that while 72% are saving for retirement, only 41% have a written retirement strategy.

I hope that you are not going to be part of the 22% of Gen Xers who will not be saved after going through our series. Then again, I also hope that if you are in the 59% without a retirement strategy, you will create one as a result of our series.

Financial challenges have hit many and using financial hardship as an excuse to derail a retirement strategy should be unacceptable. It's a good idea to be thinking big right now, and consider everything related to retirement, not just money.

Retirement planning is not just about money

Most articles focus on money but there is much more to consider. The silver linings that great planning can provide to you. At the minimum when you wake up in the morning and have your coffee, you are not worried about paying the mortgage.

I fear that poverty rates among Gen Xers will be bad. There are too many people who live today and think someone else will take care of them in the future. The golden years are only going to be golden with some effort. If you put the time in to not only view our videos and read our articles but implement what you learn, you will be among the 31% who believe they will retire comfortably.

A 2021 study by the National Institute on Retirement Security found that the median retirement savings of Gen Xers were only $72,000. You would think that with a median income for a Gen X er at between $77,000 and $86,000 the average savings should be higher.

20 years is enough time to save $800,000

If you started at $72,000, the national average and you saved the maximum allowed in a 401(k) plan ($22,500, or $30,000 if 50) plus an employer-sponsored retirement plan match your annual deposit could be as high as $40,000. This means you could save $800,000 in the next 20 years.

Of course, saving the maximum on an $80,000 per year salary does not leave much to live on so $800,000 as a target will not be possible for a large number of Gen Xers. Don't fear, your income is likely to increase during the next 20 years. Plus the value of equities increasing over time added to dividends and interest earned on your investments.

Married couples will do better since they can share many living costs such as housing, utilities, food, and more. If you are living in a high-cost area, you have the option of relocating to save money. Keep in mind as you are working on your plan, the total amount you will need to retire is based upon what you spend. You will soon know how much you will need after using our budget tool found in our next installment of Gen-X only 20 years to Retirement.

Where and what do you spend your money on

Our series will cover far more than just the amount you earn or save, we will dive deep into where you spend your money. The second installment in our series is all about the budget. For some of you, the first run-through will be somewhat painful.

The exercise of working with the budget will help you focus on your retirement needs not just your wants. You will see how much savings you will need based on factors such as income and expenses. All are variable at least during the planning stage.

One of the topics that will be discussed is aging parents. Taking care of parents who may need to live with you can be a cost that their Social Security will not cover. The shortfall must be accounted for. Let's have that discussion in a future article. If you expect to take care of your parents, you will need to in effect plan their retirement as well. Include their nest egg with yours in the planning stage.

Before you consider signing for that student loan

Do you have student loans that must be paid back? Are you a signer on a student loan that could affect your retirement? This is a major problem for many getting close to retirement. There are members of Gen X who have had children later in life.

You may be one with an 18-year-old about to attend college just as you are hitting 63 and getting ready for retirement. We will cover this too, particularly the negative impacts of being responsible for college tuition in retirement. If you have not signed up for a student loan, we will give you some good points to consider related to Gen-X and how a student loan can affect your retirement.

How long will you work? Generation Z is expected to work until about age 70 due to their failure to plan earlier for retirement. Even when they have planned for retirement, life happens. Setting a date is helpful but not required when you are 20 years out. Previous generations such as the Greatest Generation and the Baby Boomers had a defined benefit pension plan. These are almost unheard of outside of public employment.

Most Gen-X do not have pensions for retirement

Older generations knew they had a defined benefit pension plan waiting for them and planning for retirement had little to do with money. Retirement planning for older generations was more about how to fill all that time. For Gen-X, retirement is really about money plus those other things. Since most Gen X parents knew they were set up for retirement, they spent little or no time on financial planning education with their children.

Even younger generations are better off than Gen-X because they are starting to save at a much higher rate. Perhaps some of this is the fact that they as Gen Zers are still living at home getting free money from their parents which they are saving. This generation has not yet taken on the large student debt that older siblings and their parents carry.

As a generation, members of Generation X will have opportunities in the labor force to fill jobs vacated by the larger Baby Boomer generation. Their annual salary is likely to increase at a more rapid rate. This should have a positive effect on retirement income with more savings as a result.

There is no magic number for retirement savings

There is no single magic number when it comes to how much money you need for retirement. Unlike previous generations like Baby Boomers, members of Generation X will face unique challenges in determining their retirement needs. Your budget and desired retirement lifestyle will dictate your retirement goals, not arbitrary figures. Financial planning isn’t one-size-fits-all.

Some experts may insist your retirement plans must include specific financial products, but your financial advisor should work with you to develop a plan that meets your individual needs. Certified financial planners will typically conduct a comprehensive assessment to determine your required retirement income, taking into account your current savings, investments, and financial obligations.

Learning from Baby Boomers and the Great Recession

Older generations, particularly Baby Boomers, faced the negative impacts of the Great Recession, which resulted in significant financial hardship for many. Members of Gen X, often sandwiched between supporting aging parents and their Gen Z children, must plan carefully to avoid similar challenges. While the stock market can be unpredictable, diversifying your investments through Roth IRAs, traditional IRAs, and employer-sponsored retirement plans can help you weather future financial crises.

Building Financial Security with the Right Products

From target-date funds to pension plans and retirement savings accounts, financial products are key to establishing financial security. Certified financial planners recommend maximizing contributions to employer-sponsored retirement plans and utilizing Roth IRAs for tax-free withdrawals in retirement. Additionally, maintaining an emergency fund can protect against unexpected expenses.

Avoiding Pitfalls: Credit Card Debt and Early Withdrawals

A recent survey highlighted that many Gen Xers are still managing student debt, credit card debt, or both. Carrying this financial burden into retirement can severely impact your nest egg. Financial advisors warn against early withdrawals from retirement accounts, as these often come with tax penalties and reduce your future retirement income.

Social Security Benefits and Retirement Income Planning

Relying solely on Social Security benefits may not provide the financial security needed for a comfortable lifestyle. The Social Security Administration suggests that benefits are designed to replace only a portion of your pre-retirement earnings. Members of Gen X should plan for additional income streams to supplement their retirement needs.

Proactive Tax Planning: A Good Idea

Proactive tax planning is a crucial part of a successful retirement strategy. Taking advantage of Roth IRAs and other tax-advantaged accounts can reduce your tax liability in retirement. Gen Xers who are business owners or earn a median family income should work with a certified public accountant to implement effective strategies.

Financial Planning is Not a One-Time Event

The good news is there is still plenty of time to adjust your financial plans. Life changes, market fluctuations, and economic shifts will require regular reviews of your retirement accounts. Unlike Baby Boomers who may have faced greater uncertainty, Gen Xers can use lessons from older generations to their advantage.

Secure Your Golden Years

The vast majority of Gen Xers want a successful retirement, but it will take careful planning and disciplined saving. By focusing on your financial goals, reducing credit card debt, maintaining an emergency fund, and consulting a certified financial planner, you can secure a comfortable lifestyle in your golden years. Don’t wait – the best time to start planning is now. Baby Boomer Parents- Time to help

Baby Boomer parents of Gen-X "kids" have some experience with retirement, it's time they pass this information along. Most people do not talk about retirement preparation with their children or parents. I strongly suggest that parents and children begin a dialog about all aspects of retirement. Time to discuss medical costs, funds in retirement accounts, and much more.

Gen-X "children" may find that they will need to support their Baby Boomer parents and any cost must be included in a retirement budget. Also, the largest wealth transfer between generations will occur between Baby Boomers and Gen-x in the future which will affect retirement budgets. Don't ignore the topic, get into it and revise your budget.

We recommend that you read the series on your computer or tablet as the tables and tools may be difficult to work with. This is particularly true for the budget. If you are married, it's best that you work on it with your spouse, the larger screen will work better.

Gen-X Children and Retirement

You are the in-between generation. You are working on your retirement and you may have parents in their early 70s who are still working on their own plans or at least working on their plans. What about your children? Many people in their 50s have children who are at least in high school and some who are married.

As you learn about all things retirement, you should be passing this wisdom along. Encouraging your own children to learn what you are learning. There is a great series created for Millennials who may be a bit older than your children but the articles will help them. Check them out by going to this page where you can find the entire series. Come back here after using the link.

Gen-X only 20 years from to Retirement - Series Directory

Click here to see the other articles in this series. The directory has links to each article.

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FAQ: Gen-X Only 20 Years to Retirement - Get Planning

1. Why should members of Generation X start planning for retirement now?

Members of Generation X are approaching their late 50s, meaning they have less time to build their retirement accounts. Proactive financial planning can ensure they meet their retirement goals and enjoy a comfortable lifestyle in their golden years.

2. How much money should Gen Xers have saved for retirement?

While there’s no one-size-fits-all answer, financial advisors recommend aiming for 10 to 12 times your annual salary by the time you retire. Using a certified financial planner can help you determine a specific target.

3. What are some key financial products for retirement planning?

Gen Xers can benefit from contributing to Roth IRAs, traditional IRAs, or employer-sponsored retirement plans like a 401(k). Target-date funds can also help manage investments as retirement nears.

4. Is it too late for Gen Xers to start a Roth IRA?

Not at all. Even with less time to grow investments, a Roth IRA offers tax-free growth and withdrawals, making it a good idea for late-stage retirement planning.

5. How can Gen Xers avoid financial hardship in retirement?

Building an emergency fund, reducing credit card debt, and maintaining an employer-sponsored retirement plan can provide financial security. Avoiding early withdrawals from retirement accounts is also crucial.

6. How can Gen Xers balance saving for retirement with other financial obligations?

As part of the sandwich generation, many Gen Xers juggle caring for aging parents while supporting Gen Z children. Prioritizing financial goals with the help of a financial advisor can ease the burden.

7. What lessons can Gen Xers learn from older generations like Baby Boomers?

Baby Boomers faced challenges like the Great Recession, which negatively impacted their retirement savings. Gen Xers can mitigate risks by diversifying investments and maintaining a financial safety net.

8. Are there financial products tailored to Gen Xers nearing retirement?

Yes, many financial institutions offer target-date funds and other retirement savings accounts that adjust investment risk as you near your full retirement age.

9. How can Gen Xers maximize their Social Security benefits?

Delaying benefits until full retirement age or even age 70 can significantly increase monthly payouts. The Social Security Administration offers calculators to estimate benefits.

10. What role does student debt play in Gen X's financial planning?

While younger generations struggle with student loans, some Gen Xers still carry student debt or have co-signed loans for their children. Prioritizing debt repayment alongside retirement savings is key.

11. Is financial planning different for Gen X business owners?

Absolutely. Business owners should consider retirement plans like SEP IRAs or Solo 401(k)s. Consulting a certified financial planner can provide tailored investment advice.

12. Are there silver linings for Gen Xers despite financial challenges?

Yes. A recent report by Northwestern Mutual found that many Gen Xers are proactively saving more and utilizing free money through employer matches on retirement plans.

13. How can Gen Xers plan for healthcare expenses in retirement?

Opening a Health Savings Account (HSA) or contributing to an employer-sponsored plan can help cover medical costs. Factoring in Medicare and supplemental insurance is also a good idea.

14. What are the benefits of early financial planning for Gen Xers?

Starting retirement planning now allows for higher annualized returns over time. Even with just 20 years remaining, there is still plenty of time to build a substantial nest egg.

15. Where can Gen Xers find reliable retirement planning resources?

Resources like the Transamerica Center, recent retirement studies, and financial advisors provide valuable insights. Additionally, seeking certified financial planner advice can ensure a successful retirement.