A new FICO survey highlights the big challenges faced by Generation X, also commonly referred to as the “sandwich generation,” due to substantial financial obligations to both aging parents and young children.
According to FICO survey data gathered from 1,000 U.S. survey respondents, only 32% of Gen X say they are confident they will reach their long-term investing goals, while 41% feel they need to save more for the future than they are today.
Tim Van Tassel, vice president of FICO’s credit lifecycle business line, says the survey confirms genuine anxiety felt by Gen X about debt and saving levels in the aftermath of the 2008 recession.
“The sandwich generation is often financially overwhelmed by the competing obligations of having to care for both kids and aging parents,” Van Tassel warns. “This obstacle to saving means they have a real concern about a potential retirement income shortfall.”
The FICO research finds Generation X is the least confident about reaching long-term financial goals, compared with 45% confidence among older Millennials and 46% confidence among younger Millennials. Boomers are only a little more confident (36%) than Gen X.
“A core group of Gen X are paying down debt and improving their position,” Van Tassel adds. “However, this is a struggle for many people in this group. Numerous people in the survey said they were struggling with a drop in real income levels along with high credit card debt. Simple customer engagement strategies focused on cross-selling additional products aren’t going to be effective with these consumers. They want intelligent, personalized recommendations that will help them meaningfully improve their financial security.”
For financial institutions, Van Tassel says the goal to helping Gen X is to try to banish apathy.
“Present them with financial products and solutions that build trust and help them navigate issues like debt before a competitor does,” he concludes. “We are seeing the industry’s innovators using analytics to create appealing offerings that are tailored to the customer, allowing them to build repeat business and reduce churn.”
Additional research and information from FICO is available here.