- Are you a member of that versatile Generation X, successfully blending work, family and fun?
- Changing careers and defining your own lifestyle?
- If so, are you protecting that lifestyle for you and your family?
To The Men and Women of Generation X
You are redefining how Americans live and work. Bursting out of the shadows of the aging baby boomer generation, you Gen–Xers — born between 1961 and 1981— are creating new family dynamics and a new way to look at careers.
This is nothing short of a "gender and family revolution," says Stephanie Coontz, with the Council on Contemporary Families. "The rules will never be the same." ("For More Parents, 3 Kids Are a Charm," USA Today, March 10, 2004, p1.)
You are enjoying the greatest economic freedoms and opportunities in history. At the same time, you face financial challenges unlike any past generation.
What Has Changed: How You Look at Life, Work and Family
- Life is not a straight line. You see life in phases, full of opportunities and change, based on a long view of a long life. And with good reason. A century ago, Americans could expect to die before age 50. Today, you can expect to live, on average, 77.4 years?and be pretty healthy most of that time. Most of all, you see the potential of that extra quarter century plus, looking beyond traditional retirement ages. You expect to be active – working and playing – well into your 70s, 80s, even 90s. It is likely that more of you will celebrate your 100th birthdays than any past generation.("U.S. Life Expectancy at All-Time High," National Center for Health Statistics, February 11, 2004. Web page: www.cdc.gov/nchs/)
- Work is no longer Job One. While serious about careers, you are not wedded to the idea of 40 years at one company. Americans change jobs an average of 11 times during their lives, and much of that involves the restlessness of Gen–Xers. Women, especially, are stepping in and out of the work force, taking time to raise families, worrying less than in the past about getting side–railed in their career plans.("Managing a Job Change," Heritage Planning, 2000. www.lktax.com/pdf_docs/email/ls/5/0008.pdf)
- Family is important. You are having more children. For decades, the norm has been two children per family. Between 1995 and 2000, however, the rate of women having three or more children jumped from 11.4 percent to 18.4 percent. Some mothers stay at home. Others work. Others take a career break, viewing motherhood as just one of several careers they will enjoy during their lives.
Living Longer, Multiple Career Changes and Larger Families Are Creating Unique Financial Needs For Gen–Xers
The need to build wealth for financial independence. You may retire; you may not. The goal is financial independence, not just retirement. Still, changing jobs and taking family time away from work can dramatically reduce "years of service" with employer–sponsored pension plans and Social Security benefits.
Options To Consider
- Pump up contributions to employer–sponsored 401(k) and other qualified plans while working. Talk to your employer about contribution options and vesting rules.
- Roll over vested pension money into your personal IRA when you leave an employer. This keeps it under your control and can build for your future.
- Maximize IRA contributions. This is your money, regardless of job changes. Bonus: If you are married, even if one of you is not working, you each can still contribute the maximum amount to your IRAs this year. Click here for a chart of the maximum annual contribution limits per individual.
- Build non–qualified wealth through other financial products. The bottom line: Put away money today to help support you in the future.
The Need to Protect Your Children
You provide your children with the best possible lifestyle and standard of living possible. Regardless of how many you have, it is important to protect their futures. What to do:
- Tackle the legal legwork. Talk to your attorney about your will, guardianship arrangements, powers of attorney and living wills. This protects your children's rights.
- Protect their standard of living, and that of your spouse. It is estimated that it costs $240,590 to raise one child from birth to age 18. Talk to your New York Life agent about life insurance, usually the best way to replace your income and help maintain your family's standard of living if you die prematurely by illness or accident.(Consumer Reports, January 2001.)
- Provide your children with a debt–free college education. Average college costs today – including tuition and expenses – run $18,273 a year at four–year private universities, and $4,081 at public schools. Those numbers climb each year. The best way to pay for your children's education is to start saving early. Talk to your agent about college funding options.(A2002-2003 College Costs,@ The College Board, www.collegeboard.com)
If you are a member of what is known as Generation X, you are changing the way America lives and works. You are also changing the way America approaches the need for financial security and financial independence. For more information on insurance and financial products, and if you need assistance, talk to a New York Life agent.
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