As Generation X approaches the milestone of turning 60 in 2025, a survey by Natixis Investment Managers has revealed their top concerns about retirement.
Nearly half said they believe they need a “miracle” to retire securely, while half said they avoid thinking about retirement altogether. With increasing worries about financial shortfalls, 60% of Gen X acknowledge the likelihood of working longer, though 47% fear they won’t be able to work long enough to secure their retirement.
Millennials and generation Z demand ESG criteria in investment portfolios
The survey on Gen X, born between 1965 and 1980 has revealed a gap between their retirement expectations and reality. According to the findings, on average, Gen Xers plan to retire at 60, expecting a 20-year retirement which is shorter than many retirees experience. They save an average of 17% of their annual income. However, long-term return expectations of 13% may be unrealistic due to misconceptions about investment risks and a lack of knowledge about bonds.
Inflation and debt significantly influence Gen X’s retirement outlook, according to the study. About 83% of Gen X investors acknowledge the threat of inflation, with 69% stating it hampers their ability to save. Additionally, 77% said they worry that rising public debt will reduce retirement benefits, making it harder to make ends meet without these benefits.
Funds industry ‘failing to meet needs of all generations’
The data revealed a critical knowledge gap among Gen X regarding bonds. Only 2% understand that higher interest rates could devalue existing bonds, though they offer better future income opportunities. Consequently, 39% want more information on bonds, with many preferring stocks due to past market gains.
The survey highlighted the need for better education on index funds. While 64% of Gen X recognise their market-comparable returns, only 54% understand the cost benefits, and 67% mistakenly believe they offer downside protection. In this complex financial landscape, 56% of Gen X seek professional financial advice. Preference for digital advice has grown, especially in Asia and the UK, but many still rely on a combination of digital platforms and traditional advisors for financial decisions.
The full report is available here: https://www.im.natixis.com/en-intl/insights/investor-sentiment/2024/gen-x-report
