A May 2026 Schwab Gen X retirement piece lists sandwich-generation caregiving among several pressures, including credit-card debt, the pension-to-401(k) shift, and losses from the 2007–2009 recession, that have kept Gen X retirement balances low.
Sandwich-generation caregiving can divert retirement savings toward supporting aging parents and dependent children. The same can happen when supporting adult children who have not yet achieved financial independence.
Gen Xers born between 1965 and 1980 entered the workforce as employers swapped pensions for 401(k) plans, creating a structural disadvantage from the outset.
Now, with the oldest members already in their early 60s, caregiving costs are compounding that original gap during what should be their highest-earning years.
NIRS data on Gen X savings underscores caregiving squeeze that Schwab flags
The typical Gen X household holds just $40,000 in retirement savings, a 2023 National Institute on Retirement Security (NIRS) report found.
Schwab’s analysis draws on that data to explain why the figure stays so low, despite decades of consistent workplace contributions.
A 2024 Carewell survey of 1,002 Americans aged 35 to 60 found that 71% of respondents were caring for both children and aging parents.
Allianz Life’s 2025 Annual Retirement Study put sandwich-generation membership at 25% of the total U.S. population and 18% of Gen Xers.
That dual responsibility forces a painful choice between funding a parent’s care costs and maintaining steady contributions to a 401(k) plan.
Andrew Crowell, vice chairman of wealth management at D.A. Davidson & Co., told InsuranceNewsNet that sandwich-generation households face compounding financial pressure.
<strong>As loving children and loving parents, you want to do the best for both generations before you and behind you. But it just means that the pressure is on that sandwich generation to anticipate the unanticipated, which is challenging to do</strong>.
The Schroders 2025 United States Retirement Survey measured the resulting shortfall at roughly $405,000 for the average Gen X saver approaching retirement. Gen X workers have accumulated $711,771 on average against a retirement target near $1.12 million.
Also read: Americans face a painful hit to retirement in their 30s
Allianz measured caregiving’s toll on retirement contributions
The financial squeeze Schwab describes has a precise measurement, and Allianz Life’s 2025 Annual Retirement Study provides it in concrete terms.
Dual caregiving costs have pushed 59% of Americans in the sandwich generation to reduce or stop contributing to retirement savings, the study found.
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Among that group, seven in 10 reported a significant impact on their retirement plans from caring for both children and parents, the Allianz study showed.
Three out of four sandwich-generation respondents reported struggling to balance their financial goals against the obligations they have for two other generations.
Reducing or pausing deferrals also means forfeiting the employer’s matching contribution, Kelly LaVigne, senior director of Advanced Markets at Allianz Life Financial Services, warned.
The forfeited match compounds, widening the gap with every pay period that passes without a deferral directed to the retirement account.
Caregivers struggling to balance family obligations against their financial future should consult a financial professional as a first step, LaVigne recommended.
Scattered 401(k) accounts add to Gen X retirement gap
A different problem compounds the caregiving squeeze on Gen X retirement savings, rooted in the generation’s career patterns across three decades.
Frequent job changes left many savers with 401(k) accounts scattered across former employers, and those balances often defaulted into conservative portfolios.
An estimated 31.9 million retirement accounts sit abandoned nationwide, holding a combined $2.1 trillion, Capitalize, in partnership with the Center for Retirement Research (CRR) at Boston College, found.
“I think workers generally, and Gen X workers, too, should make sure they know what they’re actually invested in, and make sure that they’re actually growing their savings and not just putting money aside and missing out on any potential growth,” Tyler Bond, Senior Fellow at the National Academy of Social Insurance, said.
The Department of Labor’s lost account database allows workers to search for retirement benefits left behind with former employers and recover them.
Consolidating scattered balances into a single retirement account or an active employer plan can simplify management and preserve growth potential, Schwab’s Gen X retirement guide noted.
Catch-up provisions give Gen X a narrowing but meaningful path
Federal tax law gives workers over 50 one significant advantage, and the SECURE 2.0 Act expanded that benefit further for those approaching their early 60s.
The Internal Revenue Service (IRS) set higher catch-up contribution limits for 2026 under the expanded SECURE 2.0 rules that apply to older savers.
Those provisions have extra weight for Gen X because the generation has less time to recover from the contribution gaps created by caregiving.
Each year brings more of the generation into super catch-up eligibility, but the remaining time to benefit from the higher limits shrinks alongside it.
What Gen X caregivers can do with remaining contribution years
The oldest Gen Xers still have roughly six years before full retirement age of 67, a window Deb Boyden, head of U.S. defined contribution at Schroders, has called an opportunity to “cut this savings gap.”
That decade gives Gen X savers enough time to find ways to improve their retirement savings, Schroders said, though the survey did not recommend any specific strategies.
A 1% increase in payroll contributions can help workers regain an employer match they may have missed after reducing their contributions.
For Gen X households absorbing dual caregiving costs, the remaining runway before retirement is critical. It will determine how much of the shortfall can still be closed through higher deferrals and delayed Social Security claiming.
Related: Schwab warns of a spending shift waiting for retirees
