The Lead

Gen X's Deep Dive Into Financial Stress

What Advisors Need to Know About the MTV Generation

by Christy DeFrain

Ms. Defrain is Vice President, Sales and Account Management Purchasing Power. Visit

Gen X (born between 1965 and 1979) is now the second largest generation in the workforce today, and this group of “latchkey children” and “slacker” young adults can be viewed as America’s neglected middle child. Bookended by two much written-about generations — the Baby Boomers ahead and the Millennials behind — this driving force behind today’s companies is easily overlooked despite the fact that they are the most committed and engaged at work. Truly, Gen Xers are the source of power that keeps a business together.

So what do employers, and the brokers and agents that advise them, need to know about Gen X? What is their financial stress like? What benefits do Gen Xers want most and what’s the best method to engage them?

More about Gen Xers

Members of Generation X were dubbed the “latchkey generation” because they were home alone after school. As adolescents and young adults, they were called the “MTV Generation,” characterized as slackers and as cynical and disaffected. Many Gen Xers lived through tough economic times in the 1980s and saw their workaholic parents lose hard-earned positions. As a result, they tend to be less committed to a single employer.

Taking a closer look, Gen X is more willing to change jobs to get ahead than previous generations. They adapt well to change, are ambitious and eager to learn new skills, but they like to accomplish things on their own terms.1 They’re fiercely independent, entrepreneurial, well-educated and highly technically literate. Now at midlife, research describes Gen X adults as active, happy, and achieving a work–life balance.

Gen X’s Financial Stress, Financial Wellness and Retirement

On Financial Stress and Their Job
There are a number of reasons Generation X reports having financial stress issues:

  • 51% of Gen Xers don’t have enough emergency savings for unexpected expenses2
  • 50% of Gen Xers find it difficult to meet household expenses on time each month3
  • Although they graduated decades ago, 31% of Generation Xers are still paying off student loans. And to make matters worse, they may have a still-upside-down home mortgage on top of it4
  • Like employees of other generations, Gen X brings their financial stress to work with them. Of the 34% of Generation X who say their finances have been a distraction at work, nearly half (46%) spend three hours or more at work each week dealing with personal finance issues5

On Financial Wellness
For Gen Xers, much of their financial wellness state is due to the sandwich syndrome. This generation is supporting and educating children while also providing care for aging parents. In these circumstances, the potential for financial duress can be substantial, but steps can be taken to reduce stress, balance budgets and mitigate the effects of unplanned life events.

On Retirement
Generation X expects to retire early, at age 63 on average. To make that happen, 81% of Gen Xers are already saving for retirement and 72% say they are planning to cut their expenses so they can save more.6 Despite these efforts, as a group Gen X is on track to become the first generation to be worse off in terms of being prepared for retirement than their parents.

A Deeper Dive into their Financial Stress

Results of The Purchasing Power® Financial Stress Survey – 2018, conducted by Harris Poll on behalf of Purchasing Power in December 2017, reveals that over 4 in 5 (89 percent) of Gen Xers who are employed full-time or have a spouse employed full-time are at least somewhat stressed about their current finances.

According to the survey, 38 percent of Gen Xers who are employed full-time or who have a spouse employed full-time said they have some financial stress today; one-fourth (27 percent) reported they have a fair amount of stress; 14 percent stated they have quite a bit of stress and 9 percent indicated a great deal of stress.

Causes of Financial Stress
Household bills are the major reason cited for causing financial stress among those who are employed full-time or who have a spouse employed full-time. Causes ranked as follows for Gen Xers in the survey:

Members of Generation X were dubbed the “latchkey generation” because they were home alone after school. As adolescents and young adults, they were called the “MTV Generation,” characterized as slackers and as cynical and disaffected

  • Household bills (e.g. mortgage/rent, utilities and transportation) – 48 percent;
  • Lack of funds to cover unexpected expenses (e.g., car repair, home repair) – 39 percent;
  • Retirement planning (e.g., little or no retirement savings, no post-employment plan) – 39 percent;
  • Healthcare expenses (e.g., deductibles, prescription costs, medical bills) – 33 percent;
  • High credit balance – 38 percent;
  • Accumulating credit card debt – 37 percent;
  • Lifestyle changes (e.g., loss of/decrease in household income, family addition, increase in household occupants, elderly care) – 23 percent;
  • Education (e.g., tuition, daycare fees, student loan payments) – 23 percent;

Financial Stress Over the Past 12 Months
When Gen Xers were asked if their financial stress has increased, decreased or stayed the same over the past 12 months, 39 percent of full-time employees revealed that their stress level increased over the past 12 months; 47 percent said it stayed the same; and 14 percent report that it decreased.

Of those Gen Xers who reported their stress level had declined in the past 12 months, 32 percent said an increase in their household income contributed to that decrease; 59 percent indicated they had decreased the amount of their expenses (such as paying off balances and eliminating unnecessary services/activities) and 36 percent revealed they had used financial tools to help better budget their money.

Expected Financial Stress in 2018
Full-time Gen X employees were asked if they expected their financial stress level to increase, decrease or stay the same in 2018, compared to 2017. Nearly half (48 percent) expect their stress level to stay the same in 2018, while 32 percent believe it will decrease and 20 percent see it as increasing.

Unexpected Expenses in the Past 12 Months
The Purchasing Power® Financial Stress Survey – 2018 revealed that 73 percent of full-time Gen X employees experienced an unexpected expense in the past 12 months. Here are the most common types of unexpected expenses among those that incurred any:

  • Vehicle repair/replacement – 43 percent;
  • Medical (such as sudden illness or increase in cost related to pre-existing conditions) – 33 percent;
  • Home repairs (such as roof, boiler, siding) – 36 percent;
  • Replacing/upgrading major home appliance that stopped working – 22 percent; and
  • Travel (funeral, visit sick relative, unexpected move) – 11 percent.

These Gen Xers were also asked how they paid for the unexpected expense they incurred in the past 12 months. They reported using the following methods:

  • Credit card – 56 percent;
  • Used emergency savings – 30 percent;
  • Used money they planned to use for other household bills – 29 percent;
  • Cash – 28 percent;
  • Borrowed from family/friends – 11 percent;
  • Took out a loan (payday, title, home equity) – 12 percent;
  • Debit card – 11 percent;
  • Sold something (such as jewelry, electronics, card) – 4 percent; and
  • Borrowed from retirement savings (401K, IRA) – 6 percent.

Emergency Savings
Those Gen Xers who are employed full-time or who have a spouse employed full-time were asked if they have $2,000 in emergency savings for unexpected expenses (e.g., car breaking down, refrigerator needs replacing, unexpected health emergency that occurs), 60 percent said yes, with 40 percent answering no.

Full-time Gen X employees were asked to indicate how much money they have in emergency savings to cover the costs of unexpected expenses:

  • None – 17 percent;
  • Less than one month’s pay – 20 percent;
  • One month’s pay – 9 percent;
  • Two month’s pay – 9 percent;
  • Three month’s pay – 12 percent;
  • Four month’s pay – 4 percent;
  • Five month’s pay – 2 percent; and
  • 6 or more month’s pay – 8 percent

Gen Xers and Benefits

Gen Xers have a world of responsibilities on their shoulders. More than anyone else in the workforce, they’re likely to be juggling child or elder care with the pressures of a progressing career. Providing the right benefits can help ensure their years of experience and expertise aren’t lost.

Pay/bonuses are the benefit that matters most to Gen X, followed by paid time off and retirement plans. In addition, about one-fourth (24%) say the desire for financial stability motivates Gen X to stay in a job.Their years of work are likely reflected in their career path. Gen X is highly experienced and hard to replace, but businesses often forget about their ‘engine room’ and concentrate employee benefits around the new starters. Benefits are more engaging and appreciated when tailor-made to each generation’s needs and Generation X has some key priorities:8
1. Childcare
2. Flexibility (in working location and hours due to child/elder care issues)
3. Financial protection and education
4. Wellbeing support – Trying to balance children, elderly parents, work aspirations and their own health and wellbeing is demanding. Anything employers can do to ease those stresses are valued by Generation X.
5. Dental insurance – Children’s health is always a parent’s concern and with all the sugar in their diets these days, visiting the dentist regularly is a priority. Dental insurance covering routine care and contributing to the cost of orthodontics is highly welcomed.

Additionally, Gen Xers value salary level, a 401K plan with matching benefits, job security, advancement within the company, and opportunities for work-life balance.9

Traditional Benefits
The “standard” traditional benefits such as medical, vision and dental coverage are important to this generation. Their keen interest in financial security dictates income protection (disability insurance) should be on the list as well.
They also expect a broader range of healthcare services than they are currently offered. Today’s Gen Xers, and particularly those who struggle with chronic disease (such as heart disease and diabetes), are far more willing to pay for innovative healthcare services than older generations. The highest rated item on Generation X’s healthcare wish list – many of whom have very young children – is same-day appointments with a family doctor. In fact, 43% of Gen Xers are willing to pay for this offering.10

A Variety of Options

Gen X might be the generation needing the most variety of benefit options — they not only have children but are also very likely taking care of their parents as well. Their benefit needs include everything from income protection, financial wellness and retirement education, to family support, child care and elder care. By offering a variety of voluntary benefits, employers can provide Gen Xers the opportunity to customize their benefits package to meet their individual needs, even though they may need to pay the premium.

Child Care
Gen Xers with children are interested in worksite child care and back-up child care benefits.

Financial Wellness

With half of Gen Xers not being able to make their monthly expense payments on time and not having enough in savings for emergencies that can arise, financial wellness is a real concern for this generation. This presents an opportunity for employers. While financial wellness programs have not yet reached the level of penetration of other longstanding benefit offerings, 52% of employers have implemented or are considering implementing a financial wellness program; and 44% believe that a financial wellness program is becoming a “must-have” benefit in order to be competitive.11

The good news is that Generation X is very interested in improving their financial acumen. In fact, if offered financial education programs at work, 89% of Generation Xers would participate in them.12

In addition to financial education programs on budgeting, debt management and retirement planning, benefits such as employee purchase programs and employee discount programs help Gen Xers access products and services they need and want in a more financially-disciplined manner.

Benefits Communication

As with any generation, it’s not only about the benefits themselves. Benefits communication tailored to each generation is vital to providing value.

Gen Xers want upfront and transparent communication and prefer short, informal, regular sound bites.

What do Gen Xers need?13

  • Reach them through interactive online communications, YouTube and email;
  • Retirement readiness websites that allow them to input other investment information;
  • User-friendly online resources that can be accessed on demand to fit their busy schedules, as well as the ability to do their own research and receive feedback on their progress;
  • Access to on-demand, one-on-one professional assistance used in conjunction with web-based tools;
  • Education on the time value of money and the importance of rollovers when changing jobs.

Make sure to leverage their communication strengths. There are advantages in the way Gen Xers blend the approaches of the Baby Boomers ahead of them and the Millennials behind them. Baby Boomers drill deep and Millennials take in a lot of information over a broad range and skim. Generation X, on the other hand, takes in less information, but still drills deep.14

While Gen X isn’t perhaps the most visible generation, they’re also not as eccentric — they kind of fly low on the radar. However, it’s Gen X that is a company’s source of power and that’s what keeps a business together. Understanding what is important to them, what motivates them and how they want to work will allow employers, brokers and agents to structure benefits and develop programs that attract Gen Xers and keep them at the heart of the company.◊




1. The, “Generation X,” Sally Kane, February 2, 2017.
2. 3. PwC, 2017 Employee Financial Wellness Survey, April 2017.
4. Wealth, “The Forgotten Generation X,” April Rudin, July 11, 2017.
5. PwC, op.cit.
6. HSBC, “The Future of Retirement – Shifting Sands,” USA Report, 2017.
7. Small Biz Trends, “How to Retain Generation X Employees and Why You Want To,” Rieva Lesonsky, May 16, 2016.
8. Unum, “Five Employee Benefits Generation X Require,” April 8, 2017.
9., “Employee Benefits: What Each Generation Wants,” Oct. 25, 2016.
10. Oliver Wyman in collaboration with Fortune Knowledge Group, “Complexity and Opportunity: Survey of U.S. Health Consumers Worries and Wants,” 2017.
11. Charles Schwab, “Workplace Financial Wellness,” June 2017.
12. Bank of America Merrill Lynch, 2017 Workplace Benefits Report.
13., “How to Communicate with All Five Generations in the Workplace,” Marianne Marvez, January 30, 2017.
14. Hubworks, op. cit.