Are Millennials Ahead Of Gen X In Terms Of Saving?

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Millennials are the student loan debt generation, and they take a lot of heat for being young and naïve, especially when it comes to finances. But the oldest millennials turn 40 this year. Based on the current average life expectancy, that’s middle-aged, and in some circles, it might be considered over the hill.

The oldest Gen Xers, meanwhile, are nearing retirement age, and maybe even looking at early retirement.

In Survivor: Millennials vs. Gen X, millennial Adam Klein was the sole survivor, despite switching from tribes from Vanua to Takali. Which generation will be rewarded in the saving money game? Let’s be real: they could all use that cool $1 million sole survivor money.

The 2008 Great Recession and COVID-19 effect

Millennials came of age and entered the job market amid the Great Recession, giving them a bit of a disadvantage on everything from landing a job in their intended career to finding an affordable home.

Anecdotally, many millennials watched what the financial crisis did to their parents and families and took it to heart, becoming more savings-oriented and risk-averse.

Now, millennials are facing a second financial crisis on top of the COVID-19 public health crisis.

Many millennials already were delaying traditional major milestones like leaving home, getting married, buying a house, and having children, and the pandemic helped to reinforce that trend. A lot of people predicted a coronavirus baby boom, with little to do during lockdowns, but birthrates fell 4.3% from 2019 to 2020, according to analysis from the Associated Press. (Everyone you know got a dog, though, so what does that say?)

According to an Apartment List survey, only about 48% of millennials own homes, while nearly 70% of Gen Xers are homeowners.

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Fast savings facts

According to the Bureau of Labor Statistics, both millennials’ and Gen Xers’ savings rates are below the recommended amount.

With the assumption that they’re not spending remaining post-tax income on defined categories—from housing to “other”—millennials save less than 10% of their post-tax income, while Gen Xers save roughly 16%. The common 50/30/20 budget rule advises saving 20%, while spending 30% on wants and 50% on needs.

Score that one for Gen X, even though no one’s really winning.

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Retirement savings

Millennials start saving for retirement earlier than previous generations, according to a Natixis Global Asset Management study. On average, millennials started saving for retirement at age 23—which is essentially right out of college—while Gen Xers waited until they were 27.

According to Transamerica Center for Retirement Studies, the median Gen Xers retirement savings account has $69,000, and the median deferral (not accounting for potential employer matches) is just 7%.

Many surveys have found that Gen Xers are more worried about money than any other generation, and they also underestimate how much they’ll need in retirement.

According to the TCRS survey, the median guess by Gen Xers for how much they’d need in retirement was $500,000.

That’s not going to cut it for most people. If you’re 55 years old and earn an annual income of $75,000 pre-tax, accounting for salary increases and inflation, you’ll need close to $1.5 million to retire at 67, which falls under “normal retirement age” or NRA (no, not that one).

One way Gen Xers could try to combat their lack of retirement savings is tapping into their home equity. A home equity loan for debt consolidation can help save money if your debt isn’t too extreme.

With a few extra years of retirement savings and still nearly 30 years until NRA for the oldest of the generation, millennials have the edge here.

At the end of the day, neither will ever catch up to the Greatest Generation (thanks, Grandma!).

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-Associated Press (AP)

-Bureau of Labor Statistics’ 2018 Consumer Expenditure/Smart Asset

-Natixis Global Asset Management study

-Transamerica Center for Retirement Studies

By Casey Musarra

Casey Musarra is a personal finance writer with over a decade of writing experience and a credit score hovering near 800. She has written several hundred articles on topics ranging from taxes to debt-free living. Previous bylines include and

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