How to push back on the unique roadblocks Gen X has faced that have made retirement planning harder than it needs to be.
Today, the oldest members of Gen X are just a few birthdays away from retirement age. But instead of excitement, many feel anxiety. Because for Gen Xers, retirement planning has always been a little trickier.
Even though Gen X has been called “the slacker generation,” you could argue that the odds were stacked against them from the start. Traditional pensions mostly disappeared right as they entered the workforce, yet 401(k)s didn’t become mainstream until much later. And let’s not forget all the economic gut punches they endured, including the tech bubble, the Great Recession, and a pandemic, which disrupted their savings during some key earning years.
In this week’s episode of the HerMoney Podcast, Jean Chatzky is joined by Kerry Hannon, senior columnist at Yahoo Finance and co-author of: “Retirement Bites: A Gen X Guide To Securing Your Financial Future,” with Janna Herron. Together, they delve into why retirement planning can feel so daunting for Gen X, what makes this generation uniquely resilient, and how to turn retirement worry into optimism.
Why Gen X Faces a Unique Retirement Planning Challenge
Jean Chatzky: What is it about retirement planning right now that feels like it bites for so many Gen Xers?
Kerry Hannon: Gen X is caught between this massive Boomer generation and the Millennials coming up behind them. It’s a generation that many people, frankly, forget about. And the fact is, there have been economic challenges.
The whole business with the 401 (k) coming on stream. Nobody knew what it was, what we were supposed to do. Nobody provided us with the financial education to know what to invest in, and frankly, there weren’t very many options. Nor could you put very much money into a 401 (k) at that time. But ‘do it yourself retirement’ was all of a sudden the name of the game. The financial education piece just wasn’t there.
The HOVER Method for Retirement Planning
Jean Chatzky: You created, with your co-author, a methodology called HOVER that you use to help people cultivate a positive mindset around their money in retirement because, as you pointed out, optimism goes a long way to ensuring success. So, can we talk about how to put it into play in your life?
Kerry Hannon:
Hope: Believing things can get better.
Optimism: Knowing you have the power to make a change.
Value: Recognizing your worth and your skills.
Enthusiasm: Bringing energy and curiosity into this chapter.
Resilience: Bouncing back when life throws challenges your way.
People who are optimistic about their financial future tend to be the most successful ones. So it’s a lot about changing your mindset and being able to approach this, not with wringing your hands, but saying, ‘ Well, how can I not? ‘
The Bottom Line: Retirement Planning Doesn’t Have To Feel Daunting
Jean Chatzky: You quote Bradley Schurman in the book, and he says, “Retirement is not sexy. It is a traumatic period in your life.” Why is the reality so jarring for people?
Kerry Hannon: We go for years thinking it’s somewhere down the road. It’s out there. Just the word retire sounds like you’re stepping backwards in time and not like, ‘Oh, this is gonna be a really great stage of my life, and I need to think about how I want to approach it so that it’s affordable, and that I have fun.’ And you can do it, but you have to have a plan.
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