Gen X Has New Reason to Resent Boomers as Retirement Looks Bleak

Generation X, the unlucky cohort of Americans who became young adults during the boom years of the 1990s only to suffer a midlife bust, is facing bleak retirement prospects, according to a study.

The Pew Charitable Trusts said the typical Gen X couple, born between 1966 and 1975, only has enough savings to replace half of its pre-retirement earnings. Married Americans born during the first part of the baby boom, from 1946 to 1955, can expect to retire with about 82 percent of their income. The younger boomers, born between 1956 and 1964, can expect to quit work and make about 59 percent of pre-retirement earnings.

The report, released yesterday, comes as the 76 million-member baby boom generation is beginning to retire, while working-age adults are confronting potential shortfalls in government-sponsored retirement and health-care programs.

Younger boomers and Gen X’ers “face a real possibility of downward mobility in their golden years,” said Diana Elliott, a manager for the Washington-based research organization.

Financial planners recommend that retiring Americans be able to replace 70 to 100 percent of pre-retirement income through wealth and savings. The recession from December 2007 to June 2009, which erased $16.4 trillion in wealth, made that goal more difficult for tens of millions of Americans.

Biggest Losers

The typical Gen X’ers lost the most, with 45 percent of pre-recession net worth of $75,077 vanishing from 2007 to 2010, the Pew study said. Depression-era babies born from 1926 to 1935 saw their median $207,965 nest egg virtually unchanged. War babies, born from 1936 to 1945, suffered a typical cut of 20 percent to a pre-recession net worth of $265,797.

The Pew study, based on the Federal Reserve System’s annual Survey of Consumer Finances, found early boomers lost 28 percent of their median stash of $241,333, and their younger siblings dropped 25 percent of a typical $147,671 net worth.

Almost all generations gained more from the decade-long housing bubble than they lost in its immediate collapse, Pew found. Even so, the meltdown in the real estate market was the largest drain on net worth during the recession.

Gen X’ers again suffered the most, losing a median 27 percent, or $18,052, of their typical $67,052 in home equity. Depression-era babies lost about 3 percent, or $4,104, of their median $145,104 in home equity.

Early boomers, whose home equity amounts soared 96 percent during the housing bubble, lost about 22 percent of $143,532 in wealth during the recession. Late boomers lost approximately 14 percent of their $104,768 in pre-recession home equity, Pew said.

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