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Approaching midlife, GenX cautioned to watch spending

They are well educated with good full-time jobs and are socially and environmentally conscious. These descriptions make Generation X sound like they have the recipe for a successful retirement. But they don't tell the bigger picture of what the generation looks like headed for middle age.

Gen X is roughly defined as those born between 1965 and 1980 — making them 34 to 49 years old. So, the front end of the generation is just approaching their 50s with retirement beginning to come into view ... maybe.

"Generation X" was the 1991 novel by author Douglas Copeland about the contradictions of the generation and the name stuck.

Originally, the generation was cast as slackers too slow to grow up and living in a world of grunge with little focus and acceptance of societal norms.

But, as Gen X is coming to middle age, the picture has shifted to hard working and independent.

Gen Xers may veer from everything baby boomers hold true but the result, some say, is one of the most innovative generations responsible for the likes of Google, YouTube, Amazon and a host of other innovations and companies that have changed the landscape — for better or worse. But, how will all of that translate into retirement? From a data standpoint, a 2013 Met Life study "Gen X: The MTV Generation Moves into Midlife" sheds some light. The study shows Gen Xers consider themselves hard working and approaching "old age" at 62. According to the study, 65 percent work full-time and 82 percent are homeowners. A majority of Gen Xers are married and 74 percent have children. As their kids grow, the study says, they are looking more at retirement and savings. But they don't necessarily have a positive outlook.

"Generally Gen Xers are probably a little more skeptical that everything will be alright than the previous generations have been, but I'm not sure that's translating into savings," says Steven Dimitriou, president of the National Association of Plan Advisors and managing partner of Mayflower Advisors.

The skepticism has translated into some more realistic views of retirement.

Stephanie Thompson, investment-advising representative for Met Life Premier Client Group, says Gen Xers believe half of their retirement savings will come from pensions and 401(k) savings.

The problem, Thompson says, is what is called "pension tension" or the disappearance of company pensions. Also, while baby boomers rely heavily on Social Security in retirement, Gen X expects it may only make up about a third of their retirement savings.

While experts say Gen X is doing a better job at saving for retirement than previous generations, it isn't enough.

"They're doing OK, but there are still serious, serious gaps," says Dimitriou.

He says the big issue — coupled with the lack of retirement savings — is the cost of the anticipated longevity for Gen Xers. "People don't understand the magnitude of health care costs in retirement," Dimitriou says. "That will be the largest wild card for this generation."

— Jody Paige, Brand Publishing Writer

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