Savings lag for Gen X, baby boomers

NEW YORK — A research report by the Pew Charitable Trusts says younger baby boomers and Generation Xers face an uncertain retirement because of reduced savings, high levels of debt, and losses during the Great Recession.

The study found that members of Generation X, who are now between 38 and 47, lost almost half their wealth between 2007 and 2010. Young baby boomers, who are between 48 and 57, lost more money but a smaller portion of their overall wealth. The report says both of those groups are struggling to save enough money for retirement and are lagging older groups in terms of their savings. They also hold more debt than those groups did at similar points in their lives.

“Early boomers may be the last cohort on track to retire with enough savings and assets to maintain their financial security through their golden years,” the authors said.

The report is based on the Survey of Consumer Finances, which is conducted every three years by the Federal Reserve, and the Panel Study of Income Dynamics.

According to the report, Gen Xers lost 45 percent of their wealth during the recession, as their median net worth dropped to about $42,000 in 2010, from $75,000 in 2007. Early baby boomers, who are now 58 to 67, lost 28 percent of their wealth, falling to about $173,000 from $241,000, and later boomers lost 25 percent of their wealth, to about $111,000 from $147,000.

Based on the theory that people should have enough savings and wealth to replace at least 70 percent of their income in retirement, late baby boomers and Gen Xers appear to be falling short: late baby boomers are on track to replace 60 percent of their income in retirement, and for Generation Xers, that figure falls to about 50 percent.