"Why Generation X Is Freaking Out About Retirement

[TTL News 308]

Quote

 

For years, Mike Cundall Jr. thought he was on the proper path to retirement. 

A professor of philosophy at North Carolina A&T University, Cundall, 49, and his wife, Amy Werner, 48, did everything right. They started saving for retirement when they entered the workforce and faithfully put money from every paycheck into 401(k) plans and Roth IRAs. Their goal: to save enough to have a monthly income of $5,000 in retirement.

But now Cundall is beginning to feel apprehensive. He wonders whether he’ll be able to reach that $5,000-a-month goal and, if he does, whether it will be enough. 

One reason for the Greensboro, North Carolina, resident’s anxiety: the unpredictability of the stock market. When the financial crisis hit in 2008, he recalls, “our savings essentially got halved in a matter of weeks.” 

Then there’s inflation and rising health care costs. Financial advisers have counseled the couple to save more, but the costs of raising their three children — now 22, 20 and 13 — have made that impossible, Cundall says.

“All this has led me to believe that no matter how much we’ve saved, we’re not going to be able to retire and simply enjoy the golden years,” he says. 

Cundall’s pessimism is widely shared among his peers in Generation X — or “Generation anXious,” as a recent Northwestern Mutual report dubbed them.

 

Read the rest here.

[Chris 2,161]

I've got a plan, in addition to what we sock away in IRA's and whatnot. That plan is to retire at 65, sixteen years from now. It should work, though I guess I won't know til the time comes. 

I don't even take Social Security into consideration because even if it does still exist by then, I'm sure they'll make it so you have to be 75 to start collecting. I'm not waiting or working until then. 

[MsKreed 1,178]

 

10 hours ago, Elmira Telegram said:

One reason for the Greensboro, North Carolina, resident’s anxiety: the unpredictability of the stock market. When the financial crisis hit in 2008, he recalls, “our savings essentially got halved in a matter of weeks.” 

Then there’s inflation and rising health care costs. Financial advisers have counseled the couple to save more, but the costs of raising their three children — now 22, 20 and 13 — have made that impossible, Cundall says.

I think another factor that's being overlooked is that more of the older Baby Boomers and back retired without debt. Especially mortgage debt, which often represents up to 30% or more of a household income. 

For that generation.....first homes were typically purchased when a couple was in their 20s or 30s with a 15-20 year mortgage. Even if they used their equity to upgrade to larger homes 10 or 15 years later, it was paid off well before retirement loomed.

But now 30 years is the standard mortgage length and 40 years are offered in many places.....while 30 year mortgages were almost unheard of until the 1980s when interest rates skyrocketed. That was also followed by an explosion in home equity loans. Since solid real estate is a safe collateral banks offer way lower interest if you sign your equity over to them and keep extending your "housing costs" in 10-15 year increments.  

I've known people in their late 40s and 50s buying new homes with a 30 year mortgage that represents around 30% of their household income.  Not kids just starting out...working couples earning dual incomes at "late career" tenured salaries. That point in career and experience is usually expected to be the highest income time of our lives.

How do they (and the lenders) expect to keep paying that size mortgage up to age 75-80 (on top of inflation)?? To sign up for a plan to maintain that level of income up until that age....well (no shit) you're not likely going to "retire and simply enjoy the golden years” with that looming over your wallet. 

By the time their parents were reaching that 40-50, they were done with mortgages and could add all of that income to their savings. So it was OK to plan to retire with a monthly income much lower than they were bringing home while working, and still live comfortably. 

Edited August 20, 2023 by MsKreed

[Hal 341]

Boomer … for the longest time I thought that term was in reference to a flatulence problem of people my age 🤔😆. 
 But seriously, I do wish we had had the new retirement plans , 401k , IRA etc available in the working years . It was as stated that the norm was  work for a pension , buy a house , raise the family then put away a bit for home improvements maybe a vacation… note vacation never came . So , now the boomer is retired , family has family of their own , house is paid off , good deal in savings and now what ? Your body is used up , and as for vacation phht ! 
Now, I will say that I would not want to be starting out raising a family,  buying a home in this economy,  much less looking toward the future to retirement, especially with the uncertainty of SSRetirement and the stock market . I would be in a panic when looking toward retirement as well I mean , damn its mind boggling to this boomer how a lot of these plans work these days . Okay did i just say “these days “ geez I sound like my grandfather . 😆 damn I sure hope I have a point in here somewhere , if not please forgive . 

[Chris 2,161]

I just saw the title of this again and kinda laughed. If they knew anything about Gen X, they'd know a lot of us are like, "Pfft... whatever, we'll figure it out."

[Kevin 334]

My retirement plan is to die at my desk.

[Hal 341]

On 8/21/2023 at 3:17 PM, Kevin said:

My retirement plan is to die at my desk.

Which may come to pass if Mrs Kevin looks over your shoulder and see’s your looking at Harley Porn instead of working ! 😂😉

[Adam 373]

while not as extreme/realistic as Kevin's, my plan is welfare and/or disability...we both have retirement accounts that i pay attention to as well as small stock "portfolio" but whoever thinks social security will be solvent, or those cockroaches in DC wont keep raising the retirement age, are sorely mistaken