Retirement & Financial Planning Report

Children's education, caring for parents, saving for retirement: all add financial strain in so-called sandwich years.

Generation X—those born between the early 1960s and early 1980s—are now in their “sandwich years” and are generally in worse financial shape than prior generations when they entered that phase of life, according to the Employee Benefit Research Institute.

A sandwich situation arises when one is still paying for children—including saving for college education, currently paying for it or paying off loans for education now finished—while also taking on increasing financial (and other) responsibilities for aging parents—all while approaching retirement and the need to save for that.


“In addition to facing these major expenses simultaneously, Generation X experienced the recession of 2008 when many of them were in their 30s — a time when wage growth is typically at its highest — making it difficult for them to catch up. They are also the first generation to essentially only have defined contribution plans available to them in the private sector for the entirety of their career. With that comes the challenge of managing their finances throughout their working careers and retirement in ways that prior generations did not need to,” it said.

Compared with previous generations, Generation X households are less likely to own their own homes at their 2016 ages or to have any type of retirement plan, had lower median net worth and higher debt-to-asset ratios.