Jean Chatzky
Do one thing: If you’re having trouble managing debt and setting money aside for retirement, college, etc., you may benefit from talking to a financial advisor. Here’s more info on doing just that.
Who is GenX?
Generation X is the name given to the people who came along just after the Baby Boomers and just before the Millennials. It’s often shortened to Gen X. These days, that could stand for Gen eXhausted. Many of the 65,000 million or so Americans born between the mid-1960s and 1980 are sandwiched between aging parents and teenage and adult children who often still seek financial support and who are living at home, or moving back in record numbers.
GenX Version of Financial Planning
Needless to say, financial planning for this generation can feel more than a little complicated. “I encourage Gen X clients to stop flying blind,” says Mark Stancato, CFP, founder and lead advisor for VIP Wealth Advisors. “You need a financial roadmap that reflects your specific stage of life. Without it, the competing demands will always win—and your future self will pay the price.”
As a Gen Xer himself, Stancato understands how millions of adults are juggling the competing priorities:
- Helping older and younger generations simultaneously
- Often saving for a child’s higher education
- Still paying off old student loans
- Trying to play catch-up on retirement
“That’s a lot of financial pressure hitting from every direction,” he says. His advice?
- Get brutally clear on your priorities
- Automate what you can
- Stop trying to do everything at once
For those living the Gen X life, consider this specific advice aimed at helping you balance savings and paying off debt.
Determine What You Can’t Live Without
Stancato recommends that clients start by mapping out their cash flow and identifying what’s non-negotiable. Many people, he says, pick retirement and emergency reserves as things they don’t want to live without. He also walks folks through debt optimization—especially mortgages and lingering student loans—so clients aren’t overpaying interest at the expense of investing.
Ask Yourself Tough Questions
Similarly, Samantha Mockford, CFP, a wealth advisor with Citrine Capital Advisors in San Francisco, asks clients to prioritize goals so they can decide what they are willing to sacrifice or delay, for the sake of focused success.
Financial Sacrifices
Here are some of the real-life queries she poses:
- Retirement. Would you be willing to retire a few years earlier for the sake of retiring debt-free?
- Vacations. Would you be willing to do only camping vacations for the next two years, for the sake of landscaping your yard?
- Dining Out. Would you be willing to eat out only twice a week if it means taking your dream vacation next year?
- Wedding Plans. Would you be willing to forego a big wedding if it means being debt-free?
“There is a finite amount of money, and people get into trouble when they try to tackle everything all at once,” Mockford says. “Instead, attack your financial goals as a skeet-shooter would. Prioritize and focus on one at a time.”
Beware of Taking on Your Child’s Student Loan Debt
A 2024 study from Northwestern Mutual found that among U.S. parents saving for a child’s college education:
- 95% say they expect to cover more than half of the cost.
- Another one in three – some 36% – say they will pay for the full cost.
College Costs are Rising
If you haven’t checked in on the average price of a college education lately, you may be in for a big shock. According to the Education Data Initiative,
- $108,000 or more for four years at a public college in the U.S.
- $235,000 for four years at a private college in the U.S.
And while these figures include on-campus housing, they don’t count textbooks or food.
Be Wary of Student Loan Debt
Unfortunately, paying for college for your kids when you aren’t set up financially to manage the debt is a common issue, says Mike Hunsberger, ChFC, owner of Next Mission Financial Planning. “Gen Xers should be wary of the student loan debt they take on for their children. They may not have saved enough, and the basically unlimited amount of Parent Plus loans can get you into debt very quickly. I’ve seen too many families saddled with $200,000+ of student loan debt.”
How to Plan for Paying for Your Children’s College Education
Hunsberger says it’s important to understand the full cost of college for all of your children and how you plan to pay for it. That means if you are planning to borrow for more than one child, you should:
- Figure out what the total monthly loan payment is going to be when you’ve borrowed for all of your children.
- Determine how many years it will take you to pay off all of the additional debt.
- Have honest conversations with your children sooner rather than later about which colleges you can afford for them to attend.
“While many Gen Xers are still funding college for their kids, I remind them: there are no scholarships or loans for retirement,” Stancato says. “You can help your kids without sacrificing your future, but it has to be part of a plan, not a guilt-driven reaction.”
With reporting by Casandra Andrews
Chris O'Shea
