A retirement warning has been issued for millions of people born between 1965 and 1980, often referred to as Generation X. According to new analysis from investment firm Rathbones, many Gen Xers are at risk of sleepwalking into a retirement with far less financial security than their parents enjoyed.
Key Findings from Rathbones Survey
The Rathbones survey of 3,092 UK adults, which included 1,025 Gen Xers and 1,050 Baby Boomers, reveals that while Gen Xers are more likely to have pensions (excluding final salary schemes), they are almost twice as likely to own a buy-to-let property. However, they are less likely to hold tax-efficient investments such as ISAs or other investment accounts.
Expert Warning
Rebecca Williams, Financial Planning Divisional Lead at Rathbones, said: “Many Gen Xers are sleepwalking into retirement with far less financial security than their parents.” She explained that this generation came of age as defined benefit pensions were disappearing and has since faced stagnant wage growth and repeated financial shocks, making it harder to build robust long-term savings. Many are also part of the sandwich generation, juggling costs for both ageing parents and children.
Williams noted: “It’s perhaps no surprise that property - particularly buy-to-let - has been seen as an alternative route to funding retirement. But relying on property as a pension can leave retirees overly exposed to a single, illiquid asset at a time when flexibility is most needed.”
Property vs. Pensions
Rathbones’ research, titled “Don’t Bet the House,” suggests that the conditions driving strong property returns in previous decades have shifted. Isabella Galliers-Pratt, Senior Investment Director at Rathbones, said: “The conditions that fuelled the property boom have long since changed. Property is less flexible than pensions or investments, and rental income can be less predictable - particularly as higher interest rates, tax changes and rental reforms have squeezed returns and added complexity for landlords. The idea that property is always a ‘safe bet’ no longer holds true in many parts of the country.”
By contrast, pensions benefit from upfront tax relief, tax-efficient growth, and access to diversified investments, making them a more structured and effective way to build long-term retirement income. Galliers-Pratt added: “A more resilient approach typically involves balancing different asset classes, ensuring pensions, investments and property work together to meet income needs and align with personal risk tolerance.”
