Gen-X unprepared for retirement: survey

Generation X may have come of age long ago, but it may be experiencing “middle-child syndrome.” This demographic group is caught between two much larger cohorts — millennials, who are the object of marketers’ attention, and baby boomers, who are the focus of government policy as they march into their retirement years.

“It’s a slightly underserved market,” says Chris Karram, financial advisor at SafeBridge Financial Group in Toronto. “The average Gen-Xer is not necessarily sitting on thousands of dollars. They’re still starting to hit their stride.”

Many of those born between 1965 and 1981 — ranging in age from their mid-30s to their early 50s — are juggling several financial concerns, from building wealth and planning for retirement to leaving a legacy for their children. There’s much opportunity, Karram says, to engage them in these major life decisions.

Here are some tips on how you can connect with Gen-Xers:

> Maintain an online pool of resources
A Gen-Xer himself, Karram, who specializes in working with his own demographic, develops content for email newsletters that relate to the issues and challenges that weigh heavily on the minds of his peers.

For example, with many of Gen-Xers’ careers in “blossom mode,” Karram says, there’s a need for discussion on ways of dealing with excess cash flow, especially if these clients have maxed out their RRSP or TFSA contributions.

One way of keeping these clients abreast of issues that matter to them is by pulling together resources that they can access easily online — either via social media or your website.

> Encourage open dialogue
It was once unheard of for families to openly discuss inheritance, debt and other financial issues with their children. But to help your clients leave a lasting legacy and ensure a smooth wealth transfer, you have to start to engage the generations in discussions about the money that is at stake.

For example, if your primary client base consists of baby boomers, ask if you can hold a family meeting with their children to talk about the wealth transfer and the distribution of assets.

“I encourage clients to bring their Gen-X offspring into those meetings, so there’s clarity,” says Brad Campbell, regional director at Investors Group Inc. in Surrey, B.C.

While such discussions can help give your clients’ children a sense of security, Campbell says, these talks also can serve as a wake-up call regarding their need to be financially independent.

> Address anxieties about retirement
Gen X is generally more pessimistic about its chances of having enough money for retirement than boomers and millennials, according to the Washington, D.C.-based Pew Research Center. Many struggle with decisions about how best to allocate their earnings to fund goals with different time horizons.

As the “sandwich generation,” they may be looking after the financial welfare of both their parents and their children while trying to set aside money for their own retirement needs.

To help them strike a balance between competing obligations, plan seminars that take a “holistic” approach. Bring in professionals who offer various perspectives, such as tax and estate specialists, who can address the challenges these clients may be facing.

Karram, for example, holds a few seminars throughout the year, at which tax specialists present strategies that clients might consider.

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