Here's What the Average Gen Xer Has Saved for Retirement. The Number Might Surprise You

Saving for retirement can be a difficult thing at many stages of life. In your 20s, you may have a hard time finding the money for your long-term savings when you're deep in the throes of repaying student loans. In your 30s, you may be saving for a house and paying an exorbitant amount of money for child care just to keep your job. And in your 40s, you may be spending your money on home repairs and trying your best to fund your kids' 529 plans so they don't have to deal with the stress of student loans the way you did.

So it's easy enough to reach your 50s without a whole lot of money in retirement savings. But unfortunately, that's the boat a good number of Gen Xers are in today.

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Gen Xers' savings need work

Northwestern Mutual reports that the average retirement savings balance among members of Gen X is $108,600. But given that many Gen Xers are already well into their 50s, that's a bit problematic.

Let's say you're 55 years old, with $108,600 to your name, and have the goal of retiring at age 65. Even if you manage to save $300 a month over the next 10 years, and your investments generate an average annual 8% return (which may be an aggressive estimate because it typically requires a stock-heavy portfolio, and that's less appropriate as retirement nears), you're looking at a total savings of about $286,000.

That's not a ton of money for what could be 20 years or more in retirement. In fact, if you were to apply the 4% rule to a balance of that size, you'd be looking at $11,440 a year of annual retirement income from savings (at least initially, since the 4% rule has you adjusting withdrawals for inflation). Given that Social Security cuts may be on the horizon and the average recipient today only collects about $23,000 a year, you probably want to set yourself up with more savings than that.

It's not too late to play catch-up

If you're in your 50s with somewhere in the ballpark of $108,600 in retirement savings, you may not be in the best spot, but you're also not in the worst. You should, however, make an effort to try to boost your savings considerably in the coming decade and change, so you're able to avoid financial struggles once your career comes to its end.

In that regard, start by evaluating your current spending and seeing if there's any room to downsize. That doesn't have to mean downsizing your home. Rather, look to downsize your budget wherever you can.

If moving isn't feasible because you still have kids in high school and don't want to uproot them, trade in a more expensive car for a more cost-efficient one. Or, instead of paying for your kids to attend sports programs over the summer, have them get part-time jobs so you don't have to spend the money. Plus, that way, they can contribute to their college funds to take some pressure off of you.

Next, see if it's possible to join the gig economy. Working a side job for just a few hours a week could boost your income and help you get your hands on more money for your 401(k) or IRA. And remember, a side hustle doesn't have to mean delivering pizzas or driving for a ride-hailing service. It may be possible to line up freelance consulting work in your current field.

Finally, consider delaying your retirement if you feel you could use a few more years of 401(k) or IRA contributions. If your plan is to wrap things up at age 65, think about working until you're 67 or 68. Not only might that give your existing savings a boost, but just as importantly, it allows you to leave your nest egg untapped a bit longer. Plus, the longer you wait to claim Social Security (up until the age of 70), the larger a monthly benefit you stand to lock in.

While it's not particularly shocking to see what the average Gen Xer has saved for retirement, that number doesn't provide a lot of comfort. So if your savings could use a lift, make that your priority starting now. A few key changes on your part could lead to a retirement that's far more financially secure.

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