Millennials and Boomers Are More Confident than Gen X About Retirement – Why?

It may come off as a bit of a surprise that Millennials and Baby Boomers (their parents) seem to be more confident in retirement than those in the Gen X cohort, which is sandwiched between the Millennial and Boomer generations.

Undoubtedly, many Boomers are happily retired today. And while the recent surge in stock market volatility may cause retired Boomers to rethink their exposure to risk assets, I still think it’ll take more than just a run-of-the-mill market correction to weigh heavily on their confidence in retirement. But what about the Boomers who haven’t yet left the workforce? With many putting the last touches on their nest eggs, it should be no mystery as to why they’re feeling quite good about their prospects, especially if Social Security is due to kick in sometime soon.

In any case, according to a study, over 70% of Millennials are confident about their retirement trajectory compared to over 80% of Baby Boomers and closer to 50% of Gen X. With almost half of those in the Gen X cohort not feeling too confident, some big questions must be asked, especially when you weigh how hard Millennials had it when they graduated into one of the worst recessions in recent memory.

Let’s examine a few potential factors that may be leading Gen X to feel quite a bit less sanguine than the younger Millennials and older Baby Boomers.

Sandwiched with hefty financial expenses on both ends

Indeed, people of the Gen X generation, most of whom are in their 50s, are in a tough spot as they support aging parents (in their 80s or 90s) in addition to their adult children (20s and 30s). Indeed, supporting aging parents can get incredibly expensive, especially if their nest eggs aren’t large enough to cover a prolonged period of long-term care. Of course, life expectancies are on the rise, making the responsibility of caring for the elderly (and one’s children) something that may have to be balanced for a rather extended period of time.

Additionally, someone in their 20s or 30s may be in the early innings of their career, still burdened by student loan debts and struggling to obtain a salary that allows flexibility to meet life milestones (think buying a home) on time. Also, since many Gen X’ers are also new grandparents, they may need to chip in when it comes to care, either financially by helping out with daycare expenses or with their time, which could take away from dollars earned.

Either way, the unique age group that Gen X finds themselves in today isn’t unique to the generation. In due time, Millennials will find themselves sandwiched in that same age group, which could see expenses surge as the retirement nest egg stops growing as quickly as it did previously. 

Add recent layoff waves and tariff-fuelled uncertainty into the equation, and it certainly seems like the perfect storm is hitting Gen X at the worst possible time. In any case, many of those in the Gen X cohort who are behind may need to stay in the workforce for a while longer as they make up for lost time with any dents that expenses incurred by their adult children or parents.

The bottom line

Indeed, it’s never easy to be in a sandwich generation, especially as the lights start to dim on the economy at the hands of tariffs. With inflation likely to be on the rise, things won’t get easier for Gen X. In any case, I do think confidence rates will rise as they age while it falls for Millennials, who will run into even more financial pressures as they juggle the financial commitments of aging parents and kids from Generation Alpha.

Though there’s no easy way to side-step the financial pressures of being in the sandwich generation age group, I do think that staying invested and forgoing unnecessary expenses remains key to building and maintaining one’s financial fortress. For Millennials, the recent market correction should be viewed as an opportunity to pick up stocks at a discount rather than a red flag as it is for some Boomer retirees.

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