Recovery May Not Come in Time for Gen X

Recovery May Not Come in Time for Gen X
Kyle Bruggeman | NBC News

Kim Boylan has achieved many of the major milestones we associate with the American Dream: She got married, bought a house and has settled into a career she hopes to stay with until retirement.

She's happy to have reached those goals, but Boylan can't help but feel some regret. That's because it's taken her so long to get there.

"At 45, I feel like all of this should have happened when I was 30," she said. "I just kind of feel like I'm 15 years behind."

The unemployment rate has fallen below 8 percent, the housing industry is showing signs of stabilization and consumer confidence is up. But even as the economy shows signs of improving, many people in their 30s and 40s are feeling pessimistic about their ability to achieve the American dream and feel as financially secure as their parents.

"I worry that I'm going to be 15 years behind in retiring and all that stuff, and so I'll be like 90 when I retire," Boylan said.

Many Gen Xers fear they will never make up ground lost in the deep economic downturn of 2007 to 2009 and the years of slow growth since. Even those who have held on to jobs over the past few years have good reason to feel like they didn't really get ahead, experts say, because median income has been relatively flat for more than a decade.

Gen Xers also have had trouble building up wealth as they deal with the fallout of the housing bust and struggle with the high costs of education and health care.

Average debt: $111,000

A Census Bureau report released this year found that people ages 35 to 44 saw the biggest decline in net worth between 2005 and 2010. For those households, median net worth declined 59 percent, to $33,200, in 2010. The housing bust and the stock market were likely the biggest culprits.

A separate study from credit reporting firm Experian, released this year, found that Generation X is shouldering the most debt of any age group, with average mortgage, credit card and other debt totaling more than $111,000.

Jason Nash, 36, and his wife have two good jobs and own their home in Council Bluffs, Iowa. But between student loan payments of about $2,000 a month and childcare expenses of $1,500, the couple has little left to save for retirement.

Nash worries about whether the social programs that exist for his parents will be there for him.

"At my age, my income exceeds theirs at any time during their careers, but their lifestyle is significantly better," Nash wrote in an e-mail. "They have retirement savings. They have Social Security. They have Medicare. I expect to have only what I am able to save on my own."

Arin Strom is also worried about the future.

Strom, 39, works in the technology industry, and his job with an upscale Seattle cookware company has been relatively stable through the recession and recovery.

But despite a steady paycheck that allows his family to pay the bills, Strom feels he is essentially bankrupt. That's because the home his wife purchased in 2006 – and that the family now lives in – has lost about $150,000 in value due to the housing bust.

"While I think that my current situation is sustainable, I don't think that the long-term end game is sustainable," he said. "I don't know how you recover from a $150,000 deficit."

Like many others, Strom also struggles with significant health care expenses. He estimates that $15,000 to $20,000 of his annual salary of around $80,000 goes toward health care costs for himself, his wife and their 3-year-old daughter, Cece.

Health insurance is key to the family because Cece was born with a congenital heart defect that has required costly care and will require more procedures later in her life.

Strom doesn't want to walk away from his Seattle home. But he worries that if he holds on to the house it will make it that much harder to save enough money for retirement and other expenses later on.

"Do I think that we can get around the $150,000 question? It's possible. I don't know," he said. "Long-term, I have some real concerns about it."

Boylan, the 45-year-old, feels lucky to have escaped the housing boom and bust. She and her husband got married in May and purchased their house in Centennial, Colo., a little more than a year ago, after scrupulously saving for a 20 percent down payment.

A former radio journalist, she went back to college in her 20s and has found a career in education that she loves. But her job with the state Department of Education doesn't pay that well, and for a long time she worked a second, part-time job in radio to make extra cash. She also now has student loan debts to pay off.

"Things are going to pay off eventually," she said. "It just took me longer than I thought it would."

As Generation X ages, its members are growing more worried about retirement. A Pew Social and Demographic Trends survey released last month found that about half of Americans ages 35 to 44 are not confident they'll have enough to live on in their golden years.

Jon Miller, director of the Institute for Social Research at the University of Michigan, has spent the past 26 years following about 5,000 Gen Xers who were born between 1972 and 1975.

His most recent data has shown that about 74 percent of them are thinking about retirement, and about 63 percent are contributing to a retirement fund.

But he said a significant number also appear to be struggling, still, to get their careers on track. About 15 percent said they have had trouble finding a job, and 29 percent said they were thinking about changing jobs.

"About two out of five are people are without any meaningful thoughts about retirement because they're struggling to make it work day to day," he said.

Not all Gen Xers are pessimistic, of course.

Capt. Greg Brannon, 41, is currently serving in Afghanistan as a procurement officer for the U.S. Army.

He first joined the military in 1989, after graduating from high school, and also has served in the Air Force and Navy. He was working for minimum wage in a steel mill when he rejoined the military in 2008.

Brannon hopes to stay in the military for another few years, long enough to reach 20 years of service and qualify for a retirement package.

But when he returns from Afghanistan in May, he also hopes to get started on a bourbon-making business. When he leaves the military, he has plans to go to school to become a nurse.

"I feel like as a Gen Xer we're not going to run out of nursing jobs with the baby boomers getting older," he said.

Brannon feels like his generation has had to make plenty of sacrifices, between the wars and the difficult economy. But at the same time, he has hope that the economy is finally on the mend.

"I try to live in the moment, but it seems like I'm always thinking about the future, thinking things will be better," he said.