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While baby boomers may be terribly upset at the impact the GFC has had on their retirement funds, the latest indication from US funds managers suggest that Gen Xers will not be able to retire until they are well into their 60s, or older.
Australian Gen Xers are better off than our US cousins, thanks largely to compulsory super which was introduced in 1992 and will give most of us time to amass enough savings for the government in effect to do away with the old age pension by the time we get there. And we’re unlikely to benefit all that much from house price appreciation because most of us came into the market after the major increases of the 1990s.
This is setting up a particularly disturbing future for Gen X working mums who took time off to have kids then re-entered the workforce part time and as a result are paying less into the coffers each week.
This super differential is already being felt by female baby boomers, 60 per cent of whom are retiring with no super at all. In fact, 42 per cent of female baby boomers who attempted to retire at the promised age of 55 who returned to the workforce cited financial need as the primary driver.
Gen X women will be better off when we retire than our forebears but we’re still heading for an average retirement nest egg of just 57 per cent of what our male counterparts will have.
Again, this is not such a big deal except that by the time we get there, chances are the welfare state will have totally disappeared, so there won’t be any pension, or public housing to rely on.
As I pointed out at the beginning of this blog, Gen Xers are the perpetual losers.
We were born into a country where university was free and the average suburban house cost at most a year or two’s wages. But by the time we got to university we had to pay HECS and I’ll need some kind of prescription medication before I tell you what the housing market looked like when we were first home buyers.
Baby boomers got the sexual revolution, we got the AIDS crisis. Baby boomers came out of university or apprenticeships into a decade of full employment. We came out into the recession we had to have and a youth unemployment rate of more than 25 per cent.
But the economic malaise seemed to last only long enough to scare us into doing double degrees because by the time Gen Y was hitting the workforce, youth unemployment was back to the low teens.
The baby boomers got to wear bell bottoms and cotton kaftans – we got Lycra and hot pants, then those pesky Gen Ys reintroduced bell bottoms and invented the handkerchief dress.
Baby boomers are baby boomers because they were born into peace time. We got the height of the Cold War in which the different factions seemed perpetually on the verge of Armageddon, then the Berlin Wall fell and Gen Y got peace and rapid globalisation.
So to be entirely honest, I think we’re more than justified in asking for excellent, flexible, family-friendly work conditions (which by the way cover looking after aging parents as well as little ones). I think we’re right to ask for work-life balance so we can spend some extra time doing the stuff we enjoy.
Because let’s face it, we’re likely to work longer into our later years than any previous generation, so here’s hoping we’re doing something we enjoy because we’ll spend a heck of a lot longer doing it than our parents did.