Have you ever wondered how you compare to others like you when it comes to money? That’s to say, how your income and investing goals measure up. It’s an interesting question. Obviously, you can’t change what other people are doing, but sometimes it’s just nice to know where you fit in the puzzle. And once you see what others are doing it might lend some insight as to where you need to focus more energy.
One interesting thing about this generation are the competing financial concerns. Generation X, now in their 30s and 40s, are stuck in the midst of a terrible economy and high unemployment while trying to balance saving for retirement, raising a family and saving for college, paying down debt, and worrying about aging parents. It’s no wonder this generation is so stressed out.
Unlike older generations who didn’t take on a mountain of student loan debt and likely had at least some sort of pension to help with retirement, this generation is entirely on its own. That means taking on the full responsibility of trying to fund a retirement nest egg, putting children through college, and just trying to stay afloat in this economy.
In 1979, when the oldest Gen Xers were teenagers, the sole retirement plan for 62 percent of the workers was a traditional pension, according to Employee Benefit Research Institute (EBRI). By 2005, when most of the Gen Xers had joined the workforce, that number had flipped: 63 percent of employees found themselves covered only by voluntary 401(k) plans.
Robert O’Neill, a senior vice president at Charles Schwab who oversees the firm’s Gen X initiative, said Schwab found that Gen Xers often don’t understand investment basics. Many, for instance, don’t realize that an investor can contribute to both a 401(k) plan and an IRA. This might help explain why 82 percent of Gen Xers have no IRA, according to a Schwab survey. It’s simple things like this that have a profound impact on finances for years to come.
All of that being said, I did uncover an interesting tool that helps you think about where your priorities fit compared to others like you. Betterment has an interesting thing called Money Mea$ure-Up. You simply plug in your age and sex, and it will pull up some data that shows what others in this demographic are up to. And if you’re one of those who are a bit behind the curve when it comes to saving money, you can check out my post on why Betterment might be a good option for you. To get you started, they are offering a fee $25 bonus for signing up.
So, check it out below:
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About the Author: Jeremy Vohwinkle is a Chartered Retirement Planning Counselor® and spent a few years working as a financial planner. Today, he helps people make the most of their money by writing about personal finance here and elsewhere on the web. Jeremy is also Coach at Adaptu and a regular contributor for other publications such as Intuit, and American Express. Be sure to follow Jeremy on Twitter or Google+.