It’s a good thing that Ferris Bueller and his Gen X friends really lived it up on their day off.

Like Bueller himself said, “life moves pretty fast,” and about 40 years after the 1986 movie, they’re growing concerned about how to pay for a do-over during their rapidly approaching 401(k)-funded retirement years.

The group born from roughly 1965 to 1980, Gen Xers are the first test subjects in America’s experiment of replacing pensions, in which their employers guaranteed a certain retirement income, with 401(k) plans, in which employers guarantee only a contribution to retirement income. Now that the oldest of them are nearing the age when people typically leave full-time work, data is starting to pour in on the experiment’s results: According to the Schroders 2025 US Retirement Survey published earlier this month, about 8 out of 10 members of Gen X worry they do not have enough saved for a comfortable retirement. In raw numbers, the average member of Gen X reported feeling about $400,000 short of what they think they need.

American History Gen X

The roots of the MTV Generation’s situation date to the era before MTV, when President Jimmy Carter signed into law a bill from the 95th US Congress that added section 401(k) to the Internal Revenue Code. The measure, in brief, granted employees a tax-free avenue for deferring compensation from stock options or bonuses. But soon after its implementation in 1980, it became apparent that employers could leverage the law to create tax-advantaged savings accounts for their workers. In 1981, the IRS established further rules that allowed workers to deduct a chunk of their paycheck and put it toward the saving plans.

And just like that, the defined-contribution 401(k) retirement savings plan was created.

Employers, always looking to cut costs, were eager to pivot from the then-predominant defined-benefit pension plans and offer 401(k) programs instead. Workers, meanwhile, saw a worthy tradeoff: Pension plans made it difficult to job-hop and could crumble in a corporate bankruptcy, while 401(k)s provided a chance to ride the market to higher heights while maintaining control of their money.

Today, just 14% of private-sector US workers have access to a defined-benefit pension plan, according to the Bureau of Labor Statistics, compared with roughly 40% in 1979. On the upside, 70% have access to a defined-contribution plan, typically a 401(k) or its equivalent.

Youth of Yesterday

The problem (or one of them, at least) for Gen X? The bull market of the 1980s and 1990s gave way to the dotcom crash and the Great Financial Crisis. The result? A feeling Gen X is notorious for embracing: cynicism. “They don’t feel like they can have faith, if you will, in the fact that the markets grow over time, because they had this decade when you’re in their formidable [years] that was so difficult in terms of earning money in the markets,” Stephanie Nanney, partner and Certified Financial Planner at financial advisor group Private Vista, told The Daily Upside.

As a result, many Gen Xers embraced other financial goals, such as paying off debt, rather than retirement savings, leading them into a collective scramble as retirement age nears. While they were grappling with market downturns, policymakers were taking years to identify and make crucial tweaks to improve 401(k) sytems, compounding the effects of the gap.

“Gen X has had the unfortunate timing of working during a time that [defined-benefit plans] benefits were curtailed but 401(k) benefits were only nascent,” Nate Miles, head of global client strategy at Allspring Global Investments, told The Daily Upside. “It wasn’t until 2006,” he added, that the Pension Protection Act kicked off broad adoption of automatic features such as auto-enrollment, auto-contributions, and auto-escalation of contributions “as well as the adoption of target date funds that automatically diversify and derisk based on participants’ age.”

**Shortfall From Grace: **Now? The pitfall of the early years of 401(k) ascendancy, when young Gen Xers could boost their weekend spending power by opting out of contributions without much pushback, is all too apparent. According to a study published earlier this month by the Nationwide Retirement Institute and The Harris Poll, 60% of Gen X investors didn’t see retirement saving as a priority until the age of 50. About 40% say they are now cutting discretionary spending, and another 34% say they are increasing contributions to their retirement accounts.

Only 38% say they are on track to retire at the age they had originally planned, while 43% believe they will continue to work in some capacity to supplement their retirement income.

Fortunately, many Gen X homeowners have benefited from a massive increase in housing equity in the past five years.

**Office Space: **We know what you’re thinking, Millennial readers. But breathe easy: a retirement-delayed Gen X workforce doesn’t necessarily mean your career path will be as clogged up as the housing market.

“That’s just not the case in the US,” Anqi Chen, associate director of savings and household finance at the Center for Retirement Research at Boston College, told The Daily Upside. “What we do see in the US is if there’s more workers, then we get more productive, and so we could hire more managers, or more directors, or whatever it may be. The pie grows.”

In the meantime, younger generations can learn a thing or two from their older peers.

“Ideally, the challenges faced and knowledge gained by Gen X friends and family will help younger generations embrace the importance of starting to plan and save early so they can take full advantage of their biggest asset: the power of time and compounding growth,” Suzanne Ricklin, vice president of retention and sales at Nationwide, told The Daily Upside.

401, A-OK

According to Allspring research, based on a reasonable set of assumptions for starting salary and growth, contributions, company match and retirement age (65), only 12% of direct-contribution plan participants are at risk of not reaching their income-replacement target.

“If people are saving for their entire career, employ reasonable asset allocation and enjoy average returns, they have a great chance at a successful retirement,” Miles said. The caveat? “We know that is not always realistic,” he said, and being forced to retire at 62 rather than 65, for instance, can increase that risk rate from 12% to 34%.

In fact, if there’s a flaw in the 401(k) experiment, it’s not one of efficacy but one of access.

“Coverage is really important. People generally don’t save for retirement unless they have a retirement plan at work, and that’s about half of workers at any given time,” Chen said.

That’s a figure that hasn’t changed in decades: “In the boomer generation, it’s about the same share that had access to a pension.”

To put it in words that Gen X may be a little more familiar with: Same as it ever was.