Are you part of today’s “sandwich generation?” If you are in Generation X (born between 1965 and 1979) you very likely are. And if you are, a recent study notes that you might want to pay extra attention to your retirement planning.

A recent study by the Employee Benefit Research Institute, found that Generation X-headed families are more behind on their retirement than previous generations were at the same life juncture.

Each generation goes through the time in their lives when they are likely caring for parents while also caring for children at home, often paying for college expenses, and working at the same time. All of this happens right when retirement planning becomes more urgent. The squeeze from all sides, hence the “sandwich” name, creates all kinds of pressure and stress.

And while many in the sandwich generation don’t bemoan caring for those they love, the emotional, physical, and financial struggles that come with it are very real. Some families have three generations (or more) under one roof and others are trying to balance parents who live nearby with kids at home. Either way, there is a lot of running around and reshuffling priorities depending on health, living situations, and financial needs.

Some of the biggest findings showed that the best off GenX families showed remarkably little discrepancy with prior generations. But those who were at the biggest financial disadvantage had such a drastic reduction that it influenced the study results overall.

These are findings that are worth noting for many in GenX. Although GenX sandwich generation families might have some retirement accounts in place, there are other important factors that are missing. For instance, the study found, “Generation X families in 2016 were more likely to have an individual account (IA) retirement plan than families of Millennial and Baby Boomer generations, but they were less likely than the Baby Boomer families to own a home or have any type of retirement plan.”

That means they are losing money to rent instead of investing in a home that would give them equity and hopefully additional funds upon selling the home. But the market crash of 2008 threw many in GenX into a financial turmoil, giving them less job stability and income. Without either of those, a down payment and loan approval for a home were out of reach.

And while many in the new sandwich generation in GenX are on track for retirement, the unexpected financial challenges of caring for parents and kids can take a big chunk out of retirement savings. Parents may require extra funds for health challenges, home repairs, and living expenses, particularly if they did not have enough put aside. And as children go to college, tuition expenses can be more than what was planned for.

What can families do? Even in an emergency, it’s important to remember that retirement can’t be put off. You will reach retirement age no matter what and being financially prepared is a gift to you and to your children who will not have to support you. Your savings make take a hit or drop off as you help your loved ones financially, but keeping your eye on the goal of growing your retirement will help.

Julia Quinn-Szcesuil

Julia Quinn-Szcesuil is a freelance writer based in Bolton, Massachusetts.
Julia Quinn-Szcesuil

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