Retirement Retirement Planning

The 401(k) Decision Gen Xers Regret the Most

This mistake is making many delay retirement.

By Catherine Collins , Edited by Laura Hohenstein

Updated May 25, 2026

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Gen X is the first generation to have 401(k) retirement plans available during the majority of their careers. Additionally, many members of Gen X are currently at the peak of their high-earning years.

However, more than 80% of Gen X workers have regrets when it comes to their 401(k) retirement plans. Here is their top regret, as well as some other Gen X statistics that serve as a warning for younger workers.

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The ages of the current members of Generation X

Gen X includes people who were born from 1965 to 1980. That means Gen X is primarily made up of people who are between the ages of 46 and 61. Many people in Gen X are thinking more about retirement because they are in the later years of their career and nearing typical retirement age.

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The number one 401(k) regret for Gen X

According to a survey from Allianz, 55% of Gen X wish they had saved more money for retirement.

In a separate survey from the CFP Board, 53% of Gen X said they wished they had prioritized retirement earlier. Respondents from the same survey also shared several other events Gen X wish they had saved more for, including college costs for their children and being a homeowner.

Why Gen X is behind on their retirement savings

There are a few reasons that Gen X is behind on their retirement savings. First, many of them cashed out their 401(k)s when leaving jobs and switching employers. Cashing out a 401(k) early usually means that workers have to pay a 10% early withdrawal penalty if they are under age 59 1/2. Additionally, cashing out a 401(k) usually means that workers increase their income for that year, which can result in higher taxes.

Secondly, more than one in four Gen X workers have taken out 401(k) loans, which is the highest percentage out of any generation. Although a 401(k) loan can provide a temporary cash infusion, the biggest drawback is that the money removed from a 401(k) cannot compound and grow. Finally, many members of Gen X simply did not save enough over time.

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The $400k+ gap for Gen X's retirement years

There is a large gap between the amount of money Gen X says they'll need in retirement and the amount Gen X has actually saved on average.

Currently, people in their 40s and 50s have saved an average of $409,686 and $629,000, while the median is $156,675 and $246,554. Those currently in their 40s and 50s likely align more closely with the median.

Gen Xers expect to accumulate just over $700,000 in retirement savings, but they say they need an average of $1.1 million to retire. That means there is more than a $400,000 gap between the amount of savings that is likely for Gen X and what is actually needed.

Ways Gen X can close the retirement gap

Fortunately, even though Gen X is behind on retirement savings, many still have time left in the workforce to add to their nest eggs. For example, Gen X can take advantage of catch-up contributions starting at age 50. Those aged 50 or older can contribute an extra $ 8,000 per year on top of the $24,500 401(k) maximum. Workers aged 60 to 63 can contribute an extra $11,250.

Social Security adds a stream of income, but it's not enough

Those workers who are in Gen X will also have the opportunity to get an additional stream of income in retirement once they start receiving their Social Security benefits. If Gen X is able to delay Social Security benefits to age 70, they can get an even larger check.

Social Security is helpful because it is a form of guaranteed income. However, the OASI Trust Fund reports that Social Security will be underfunded by the year 2033 unless Congress passes new legislation that fixes this discrepancy.

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Where Gen X can get advice on retirement planning

If workers who are in Gen X want to make sure they are on track for retirement, one option is to consult the advice of a financial planner. A financial planner can review your retirement goals, your current 401(k) portfolio, and your projected income from Social Security. Then, they can make recommendations on ways to optimize your 401(k) contributions so that you do not have to delay retirement.

Bottom line

Even though Gen X was one of the first generations to use 401(k)s throughout their careers, many workers still have a deficit between how much they will need in retirement and how much they have currently saved.

The good news is that it is not too late for many members of Gen X to catch up. In order to have a stress-free retirement one day, Gen X workers can take advantage of catch-up contributions and maximize their contributions during their last few years of working.

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