{"id":137540,"date":"2025-11-16T07:30:16","date_gmt":"2025-11-16T07:30:16","guid":{"rendered":"https:\/\/www.newsbeep.com\/nz\/137540\/"},"modified":"2025-11-16T07:30:16","modified_gmt":"2025-11-16T07:30:16","slug":"what-gen-xers-unprepared-for-retirement-should-do-in-2026","status":"publish","type":"post","link":"https:\/\/www.newsbeep.com\/nz\/137540\/","title":{"rendered":"What Gen Xers Unprepared for Retirement Should Do in 2026"},"content":{"rendered":"

\"Multi <\/p>\n

\n sanjeri \/ Getty Images <\/p>\n

Commitment to Our Readers<\/p>\n

GOBankingRates’ editorial team is committed to bringing you unbiased reviews and information. We use data-driven methodologies to evaluate financial products and services – our reviews and ratings are not influenced by advertisers. You can read more about our editorial guidelines<\/a> and our products and services review methodology<\/a>.<\/p>\n

\"\"<\/p>\n

20 Years
Helping You Live Richer<\/p>\n

\"\"<\/p>\n

\"\"<\/p>\n

Trusted by
Millions of Readers<\/p>\n

Gen Xers are the next cohort to retire<\/a> after baby boomers. While that may still be a decade or more away for the youngest members, if your retirement savings don\u2019t feel robust enough, retirement can seem more stressful than exciting.<\/p>\n

For Gen Xers feeling underprepared for retirement, here are 11 things to do in 2026 to get back on track<\/a>.<\/p>\n

Take a Reality Check<\/p>\n

Start by taking a reality check, according to Stoy Hall, CFP and CEO and founder of Black Mammoth<\/a>. \u201cList every account, total the balances, write down what you\u2019re saving each month and calculate the gap between your current path and the number you actually need.\u201d<\/p>\n

If it takes more than half an hour, you\u2019re overcomplicating it, he said.<\/p>\n

Sketch a Bracket Map for 2026<\/p>\n

Next, sketch a quick \u201cbracket map\u201d for 2026, Hall said. Decide what income you want taxed now and what you want taxed later. \u201cYour marginal rate might shift. That affects Roth versus pre-tax, when you want bonuses to hit and how you handle capital gains<\/a>.\u201d <\/p>\n

Take Advantage of Catch-Up Contributions<\/p>\n

At age 50, Gen Xers are eligible for catch-up contributions, an additional $7,500 to retirement accounts like 401(k)<\/a> and 403(b) plans, for a total of $31,000 annually, Hall explained. If you\u2019re 60 to 63, use the higher \u201csuper catch-up\u201d of an additional $11,250, with a cap of $34,750.<\/p>\n

As of 2026, however, higher-earning workers may be required to make catch-up contributions on a Roth-only basis in workplace plans, according to Ashley Weeks, a wealth strategist at TD Wealth<\/a>.<\/p>\n

\u201cThis means those catch-up contributions may not provide a current reduction in taxable income but will be eligible for tax-free growth. The income threshold for this new provision is $145,000 of earnings in the prior year,\u201d Weeks explained.<\/p>\n

Hall recommended automating all catch-up contributions.<\/p>\n

Beef Up Emergency Savings<\/p>\n

\u201cThe single most important action anyone can take regarding retirement preparation is to diligently maintain an emergency savings account<\/a> with at least four months of living expenses,\u201d Weeks said.<\/p>\n

This helps protect against unexpected events like job loss, which could lead to early retirement account distributions and penalties if there isn\u2019t an adequate emergency cushion, he advised.<\/p>\n

Hall suggested an emergency fund of nine to 12 months if you\u2019re single, self-employed or have variable income.<\/p>\n

Save For Other Expenses Here<\/p>\n

Any expense coming in the next one to three years belongs in a high-yield savings account<\/a> or short Treasury ladder, Hall urged. \u201cNot stocks. Everything else goes to your target mix. Cash is a tool for stability, not a growth plan.\u201d<\/p>\n

Roth Conversions<\/p>\n

If you\u2019re thinking about a Roth conversion, remember that \u201cconversions help when today\u2019s bracket looks lower than your future bracket, you want smaller required distributions later and you can pay the tax from outside the IRA,\u201d Hall said.<\/p>\n

He advised working \u201cin brackets, not guesses.\u201d Stop before spilling into the next tax bracket, where you\u2019ll pay more.<\/p>\n

Additionally, \u201cWatch the usual cliffs in later years like Medicare surcharges and ACA thresholds. Gen X has a wider runway before required minimum distributions (RMDs), which makes staged conversions practical,\u201d he said.<\/p>\n

Employer Match and Debt Repayment<\/p>\n

Anyone who receives an employer match for their 401(k) plan should take the full match every time, Hall insisted. \u201cThat is a guaranteed return. After that, attack any debt around 8% to 9% APR or higher before adding extra to investments. Paying off a 17% card balance beats hoping the market bails you out.\u201d<\/p>\n

Social Security for Gen X<\/p>\n

Deciding when to claim Social Security<\/a> is an important but tough call. While full retirement age is 67, you can start claiming as early as 62, but you\u2019ll lock in a smaller benefit for life, Hall explained. Waiting after 67 increases benefits by about 8% per year until age 70.<\/p>\n

\u201cSingles with strong health and long family longevity often benefit from waiting. If cash flow is tight or health is an issue, earlier can be appropriate.\u201d<\/p>\n

Couples should delay the higher earner to age 70 to protect the survivor benefit, then time the lower earner around cash flow and taxes.<\/p>\n

Using Home Equity Wisely<\/p>\n

If you need more cash and own a home with equity, a home equity line of credit (HELOC) is useful if your first mortgage rate is low and you need flexible access for projects or as a safety valve, Hall said.<\/p>\n

However, he warned, keep usage modest and, if possible, choose fixed-rate loans to avoid variable-rate increases. \u201cA cash-out refinance only makes sense if the rate and cost math work and you\u2019ll hold it long enough to benefit.\u201d <\/p>\n

Otherwise, downsizing is a great option if the house is too big or too expensive. \u201cLower payment, lower taxes and insurance, less maintenance and equity you can redeploy to the plan,\u201d Hall said.<\/p>\n

Bring In Side Income<\/p>\n

If you can do some side work around your day job, Hall urged finding ways to add income. \u201cSell your expertise in fixed-scope blocks. Take expert network calls for 30 to 60 minutes. Offer four-week consulting sprints with one clear deliverable. Teach a workshop your employer can sponsor.\u201d<\/p>\n

Whatever you do, he said, keep it simple.<\/p>\n

Be Strategic With Investing<\/p>\n

Finally, when considering your investment approach, Weeks said there\u2019s no single default allocation that works for Gen Xers since \u201cthe oldest members of this cohort are at the doorstep of retirement and the youngest Gen Xers could still be working in 20 years.\u201d<\/p>\n

Gen Xers should assess their risk tolerance since major portfolio losses shortly before or after retirement are more likely to deplete funds needed for retirement expenses. Starting 10 years before their planned retirement date, \u201cGen Xers should develop a strategy to methodically reduce portfolio volatility as retirement approaches,\u201d Weeks said.<\/p>\n","protected":false},"excerpt":{"rendered":"sanjeri \/ Getty Images Commitment to Our Readers GOBankingRates’ editorial team is committed to bringing you unbiased reviews…\n","protected":false},"author":2,"featured_media":137541,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[14],"tags":[138,246,3319,111,139,69,244,245,660,294],"class_list":{"0":"post-137540","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-personal-finance","8":"tag-business","9":"tag-finance","10":"tag-gobankingrates","11":"tag-new-zealand","12":"tag-newzealand","13":"tag-nz","14":"tag-personal-finance","15":"tag-personalfinance","16":"tag-planning","17":"tag-retirement"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/137540","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/comments?post=137540"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/posts\/137540\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media\/137541"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/media?parent=137540"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/categories?post=137540"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/nz\/wp-json\/wp\/v2\/tags?post=137540"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}