How Much Does the Typical Gen Xer Have Saved for Retirement?

Since members of Generation X were born between 1965 and 1980, some are getting close to the age when they’ll be eligible for Social Security for the first time. And while most are still a decade or two from retirement, members of Gen X should still be well on their way to saving for a secure future.

But are they? Let’s look at how much the typical member of Generation X has invested for their later years.

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Here’s how much the typical Gen Xer has saved for retirement

According to Fidelity, members of Gen X have an average 401(k) balance totaling around $217,500.

This average balance is second only to baby boomers, who have an average of $267,900 in their 401(k) accounts. It is considerably more than members of Gen Z, who have just $17,000 invested on average.

This makes sense. The oldest Gen Xers are getting close to retirement, but baby boomers are even closer or have retired already, so it’s natural that these two generations would have more savings than most other age groups. However, this still doesn’t mean it’s enough.

A nest egg of $217,500 would provide around $8,700 in annual income, assuming you follow the 4% rule. Even if you combine that with an average Social Security benefit of $2,071, living on so little each year will be tough.

That’s especially true when you consider that Social Security only replaces around 40% of pre-retirement income. You need another 40% or so to come from money in retirement plans. If it doesn’t, you could find yourself struggling to cover the basics, like housing, transportation, and out-of-pocket costs Medicare doesn’t pay for.

How can you beat the average and boost your retirement benefits?

If you want to ensure you have more than the average and are on track for the security you deserve in retirement, the first step should be getting serious about your retirement planning. You should have a clear goal in mind for how big your nest egg needs to be, making sure to take taxes, healthcare costs, and inflation into account.

For most people, a good rule of thumb is that you want to end up with about 10 times your final salary in your retirement accounts. Once you know that goal, you can use online calculators like the ones at Investor.gov to figure out how much to save each month until your chosen retirement date.

If you can automate the necessary contributions to your 401(k) or IRA, even if that means making budget cuts to do it, then you have a better chance of following through on your savings goal — even if you do nothing, the money will go where it needs to each month.

If you’re one of the oldest Gen Xers and are in your late 50s or early 60s, then making up for retirement-savings shortfalls will be harder. For members of this generation with 20 years left until retirement, there’s plenty of time.

While the math gets more challenging for those looking to retire in the next five years or so, it may still be possible to achieve retirement security. But it may mean staying in the workforce a little longer than planned — and perhaps downsizing your home, or moving to an area with a lower cost of living.

The key is to take stock of where you are now, and start working on a serious plan to ensure you have the money you need to be one of the Gen Xers who beat the average.

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