Gen X Faces Retirement Readiness Challenges, Self-Directed IRAs Offer Potential Solution
TL;DR
Gen Xers can boost retirement savings with nontraditional investments to diversify portfolios and build a tax-advantaged hedge against stock market volatility.
Self-directed retirement plans from Next Generation allow investors to make all their own investment decisions and diversify their retirement portfolios with alternative assets.
Next Generation's specialized retirement plans offer a strategy for Gen Xers to build a more secure financial future and better prepare for their retirement years.
Insights from surveys and reports shed light on Gen Xers' lack of retirement readiness, highlighting the need for alternative retirement strategies like self-direction.
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Recent surveys and reports have shed light on the retirement readiness challenges faced by Generation X, those born between 1965 and 1980. Jaime Raskulinecz, CEO of Next Generation Trust Company, a firm specializing in self-directed IRAs, has highlighted key findings that paint a concerning picture for this demographic's financial future.
According to various studies cited by Raskulinecz, including the 2024 Annual Retirement Study from Allianz Life Insurance Company of North America and the 2024 Transamerica Retirement Survey of Workers, Gen X is struggling with retirement planning. Only 44% have a plan for retirement income, while 55% wish they had saved more. Alarmingly, 35% have no retirement account at all, and 60% worry about outliving their savings.
The reasons for this lack of preparedness are multifaceted. Gen X has faced numerous financial challenges, including lingering student debt, mortgage payments, credit card debt, multiple stock market downturns, and the financial impact of the COVID-19 pandemic. Additionally, many are juggling the responsibilities of caring for aging parents and supporting grown children, further straining their ability to save for retirement.
As a potential solution, Raskulinecz suggests self-directed IRAs as a strategy for Gen X to boost retirement savings. These accounts allow investors to diversify their portfolios with alternative assets such as real estate, precious metals, and private equity. This approach could provide a hedge against stock market volatility and offer more flexibility in investment choices.
The implications of Gen X's retirement unpreparedness are significant. If a large portion of this generation delays retirement or continues working through their retirement years, it could impact workforce dynamics and economic patterns. Furthermore, the potential strain on social services and healthcare systems could increase if many Gen Xers find themselves financially unprepared for retirement.
For financial advisors and policymakers, these findings underscore the urgent need for targeted retirement education and planning assistance for Gen X. The promotion of diverse investment strategies, such as self-directed IRAs, may become increasingly important in helping this generation bridge the gap in their retirement savings.
As retirement approaches for the oldest members of Gen X, the coming years will be crucial in determining whether they can overcome these challenges and secure their financial futures. The financial services industry may need to adapt and offer more flexible retirement solutions to address the unique needs of this generation caught between traditional pension plans and the 401(k) era.
Curated from 24-7 Press Release
