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Here's a reality check: If you're part of Generation X (approximately ages 45–60), it's worth knowing where you stand and how you might strengthen your financial footing. With thoughtful action, you should be able to build your wealth in meaningful ways.
In this article, we'll examine how Gen X is doing, then present actionable strategies that could help you increase your net worth.
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Where Gen X stands financially
According to the most recent data from the Federal Reserve (via Fidelity Investments), American households whose reference person is age 45–54 have an average (mean) net worth of about $975,800, and those age 55–64 have about $1.57 million. Looking at the median (which tends to give a more realistic picture for typical households), for ages 45–54, the median net worth is roughly $247,200, and for ages 55–64, about $364,500.
In plain terms, many Gen Xers are behind where one might ideally like to be heading into the later working years, but there's still time to pull ahead.
Why you may not be further ahead
Several structural and personal factors contribute to slower net-worth accumulation for many in Gen X. For instance, Gen Xers frequently support growing children and aging parents simultaneously, increasing financial strain. Many Gen Xers entered the workforce or major asset-accumulation phase during or shortly after the early-2000s tech bust, the 2008 financial crisis, and a more volatile housing market. These events have disrupted wealth-building momentum. Gen X also has a high debt burden. For example, Gen X households hold relatively high mortgage liabilities.
That said, here are some steps you can take to help increase your own net worth.
1. Pay down high-interest and non-strategic debt
When you carry debt with high interest (e.g., credit cards, some personal loans), the interest is effectively eroding your ability to save and invest. Prioritize paying off debt with interest above ~8–10 % (or whatever rate you could otherwise earn by investing). Consider the "debt-payoff" ladder or "snowball" method (smallest debt first) if you need motivation. Once high-cost debt is serviced, redirect those funds toward savings or investments instead.
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2. Maximize retirement-saving vehicles and tax advantages
With retirement still ahead for many Gen Xers, making the most of tax-favored accounts matters. If your employer offers a 401(k) or similar plan, aim to contribute enough to receive any company match. It's effectively "free money." After the match, consider increasing contributions when possible (e.g., an extra 1–2 % of pay per year) to capture compounding. Use IRAs (traditional or Roth) depending on your tax situation and contribution eligibility. Regularly review asset allocation periodically to ensure your investments align with your horizon and risk tolerance.
3. Invest in income-producing or growing assets (rather than just savings)
Simply holding cash isn't sufficient over longer terms, especially with inflation. Diversified equity or index-fund exposure as part of your portfolio, which historically has grown more than cash. Regular rebalancing to stay aligned with your goals and avoid over-concentration in any one asset class.
4. Increase earning potential and reduce "wealth leakage"
Your income and how you spend it both play major roles in building wealth. Seek opportunities to advance skills, certifications, or credentials that can raise your income ceiling. Consider side gigs or passive income streams to create diversification of earnings. Track your spending: create a realistic budget, identify non-essential "wealth leakage" (e.g., subscriptions, impulse purchases), and allocate savings before you spend. Redirecting windfalls towards investments rather than letting them build up as lifestyle inflation can also push your savings to the next level.
5. Build an estate and legacy mindset
As you move closer to later working years, planning ahead can protect and augment what you've built. Ensure you have an up-to-date will or trust, power of attorney, and health-care directives. Meet with a financial advisor to map out projected retirement income, required savings, and possible gaps. You should also consider how any inheritance might impact your net worth and plan for those taxes now.
6. Setting meaningful targets and tracking progress
Having a benchmark can help with savings. If you're in your late 40s or early 50s and your net worth is under the median (~$247,000 for ages 45–54), you might view this as a signal to increase focus. If you're in your late 50s (age 55–64) and under the median (~$364,500), it could be a sign to boost your savings rate or adjust asset mix.
But remember: these are benchmarks, not guarantees. Your personal target depends on factors like desired retirement lifestyle, health, location, family structure, debt level, and risk tolerance.
7. Consistent tracking matters
Each year, you should sit down and track your financial progress. Calculate your net worth (assets minus liabilities) and compare the change from last year. An upward trend (even a modest one) is progress. Revisit your budget, savings rate, and investment plan, and adjust if you're falling behind.
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Bottom line
Gen Xers still have time to strengthen their financial position, but doing so requires deliberate planning and steady action. Paying down high-interest debt, investing consistently, and using tax-advantaged accounts can help you prepare yourself financially for retirement and unexpected expenses.
A recent Allianz survey found that more than 60% of Gen Xers worry they'll run out of money in retirement, proof that financial anxiety is common, not personal failure. The key is to build flexible strategies that could help you withstand economic downturns and keep your long-term goals on track.
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