In recent discussions with our clients, we've noticed a common theme among Generation X—an increasing sense of financial uncertainty, especially after the events of the last few years. From supporting both aging parents and children to the challenges of saving for retirement without the security of traditional pensions, many Gen Xers are feeling the weight of these unique financial pressures. At Unleashed Financial, we understand these challenges and are here to help you navigate them.

Here are four major financial risks Gen Xers face today, along with strategies to address them.

1. Outliving Your Retirement Savings

With advances in healthcare, life expectancy is increasing, which means many of us will spend more years in retirement than previously planned. Without the benefit of a pension, Gen Xers are relying heavily on 401(k)s, IRAs, and personal savings to provide long-term financial security. The key to avoiding the risk of outliving your money is thorough planning.

What to do:

• Consider diversifying your income sources in retirement. Annuities, for example, can provide a guaranteed income for life.
• If possible, delay taking Social Security benefits. Every year you wait after reaching full retirement age increases your benefit by 8%, allowing for higher monthly payments.
• Maximize contributions to your 401(k) and other retirement accounts during your highest earning years. If you can, take advantage of catch-up contributions available once you reach age 50.

2. Rising Healthcare and Long-Term Care Costs

With longer lives come increased medical expenses, which can eat into your retirement savings. Health care costs, including long-term care, are rising, and many Gen Xers are sandwiched between caring for their children and their aging parents, adding additional financial strain.

What to do:

• Look into long-term care insurance, which can help cover the cost of assisted living or nursing home care if needed.
• Consider opening a Health Savings Account (HSA) if you have a high-deductible health plan. HSAs allow you to save for future medical expenses with pre-tax dollars, and unused funds roll over year after year.

3. Volatility in Financial Markets

Market fluctuations can have a significant impact on your retirement savings, especially if you’re nearing retirement or have already left the workforce. This volatility is particularly concerning during times of inflation, as purchasing power diminishes even if your investments grow.

What to do:

• As you approach retirement, shift a portion of your portfolio into less risky investments, such as bonds or cash equivalents. However, it's important to maintain some exposure to growth-oriented investments like stocks to ensure your savings keep up with inflation.
• Consider investing in Treasury Inflation-Protected Securities (TIPS), which adjust with inflation to help maintain your purchasing power.

4. Estate Planning for Blended Families

Many Gen Xers have blended families, with children from previous marriages or partners. This can make estate planning more complex, as you want to ensure all your loved ones are taken care of while avoiding potential conflicts.

What to do:

• Work with an estate planning attorney to create or update your will. Be clear about how you want your assets distributed to both your spouse and children from any previous relationships.
• Consider setting up a trust, which can provide greater control over how and when your assets are distributed. This can be especially important in blended families to ensure fairness and to prevent disputes.

At Unleashed Financial, we are committed to helping you manage these risks and ensure your financial future is secure. Whether it's planning for a longer retirement, preparing for rising healthcare costs, or navigating complex family dynamics, we're here to guide you every step of the way.

Contact our team today to start building a financial plan tailored to your unique needs as a Gen Xer.