I’m a Gen Xer Who Just Started Saving For Retirement: Here’s My Monthly Budget
Written by
Laura Beck
Edited by
Levi Leidy
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Gen Xers — the smaller, sometimes forgotten generation sandwiched between baby boomers and millennials — are known for a lot of things: the cult classic “Reality Bites,” the rise of the supermodel and the general disenchantment with all things status quo. That might be a reason that some Gen Xers took a while to start saving for retirement. Well, that and the job instability, student loan debt and the lingering effects of the Great Recession.
Liz B., a Gen X telework employee based in Boise, Idaho, has a busy life — a kid headed to college next year, credit card debt and the desire to start building a retirement nest egg are all on her mind.
“I’m saving for my kid’s college as well as retirement, and paying down credit card bills that grew during the pandemic,” said Liz. “I started saving for retirement about eight years ago, but when the pandemic hit and my job was eliminated, saving stopped for a while.”
Liz’s Monthly Budget Breakdown
Liz provided more insight into how her monthly budget currently breaks down.
“About 50% goes to living expenses which include mortgage, medical, veterinary, utilities and regular other bills and expenses like clothing. We get takeout dinner on Fridays, don’t drink or smoke and every now and then do something fun like go to a local play or movie.”
She continued, “10% goes to credit card bills and the other 10% goes into savings. Unfortunately, 2022 wasn’t kind to the 529 plan — it has yet to recover fully — so college savings go into a high-interest savings account. Once saving for college and the associated expenses are off the budget, we’ll be saving 30% or more of our monthly budget for retirement.”
The Long Haul
Liz says even with budgeting, she’ll stay in the job force for quite some time.
“I anticipate I’ll be working for the next 18 years, if I’m lucky to have saved enough to fully retire,” she shared. “We’ll likely sell our house and move into a small, low-maintenance place. My biggest concern these days is the cost of healthcare and medical expenses. When you’re young it seems so far away, and now it’s just moments away.”
Meet Sarah, Another Gen X Saver
Sarah, a 51-year-old marketing manager from Phoenix, Arizona, is a similar pinch. She didn’t start saving until last year after climbing out of the financial hole she found herself in because of loss of work due to the pandemic.
Sarah’s monthly budget breaks down like this:
- Income: $6,500
- Mortgage: $1,800
- Utilities/bills: $800
- Groceries: $600
- Fun money: $300
- College funds: $1,000
- 401(k) contribution: $1,000
- Debt payments: $1,000
“It’s tight, but I really need to save some money so I’m bucking down” Sarah shared. “The 401(k) contribution is the most non-negotiable, and the kids’ college funds are a close second.”
Budgeting Tips for Gen X Savers
Here are some budgeting tips for Gen Xers looking to get their savings back on track.
- Automate it: Nothing will build up cash like setting and forgetting. Because if you don’t set it, odds are you will forget it.
- Reduce debts: If you can, aggressively tackle all of your debt. The less you’re paying in interest, the more you can allocate toward savings.
- Downsize your lifestyle: Can you cancel a subscription? Can you eat at home more? Do you need the gym membership or can you get a workout in your living room that’s just as effective? Look at everything and cut, cut, cut.
- Increase your income: Side gigs and freelance work on the side can bring in a decent amount of extra funds.
- Reevaluate your budget regularly: Sit down with your budget every few months to make sure you’re still doing your best. If you don’t keep up with it, it can get away from you very quickly.
It’s never too late to start saving for retirement — and Gen Xers like Liz and Sarah show us that’s true.
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