If you are a Generation Xer, you stand at a unique crossroads today. As part of the “sandwich generation,” you may be facing the reality that saving, investing, and planning for the next generation is both more challenging and more urgent than you may have thought.
At Brown|Miller Wealth Management, our team of CFP® professionals in Washington, DC, specializes in helping Gen X clients transition from managing day-to-day demands to building lasting, multi-generational wealth.
In our blog today, we’ll look at typical generational wealth-building questions we receive from Gen X clients, along with various investment strategies you can deploy today to start building lasting generational wealth for you and your family.
- “Can I still catch up on retirement saving efforts if I’m behind?”
- “How do I balance saving for retirement while helping my kids?”
- “What’s the best way to start building a legacy?”
- “Should I invest differently as I near retirement?”
The Gen X Challenge: Balancing Today and Tomorrow
If you’re between 45 and 60, you might be supporting kids while managing healthcare or housing for parents. Those competing priorities often delay savings or reduce investment contributions for several years.
Add in mortgages, education costs, and the absence of old-fashioned pensions (guaranteed income for life), and it’s easy to see why so many Gen X families feel squeezed.
But the advantage you still have is time and flexibility. You still have critical earning years ahead and a clearer view of what truly matters. The right strategy can help you support your family now while laying the groundwork for financial independence and a legacy for future generations.
Top Gen X Wealth-Building Strategies
Here are several wealth-building strategies you can employ now to expand your retirement savings efforts:
- Maximize Retirement Accounts and Catch-Up Contributions
- Make the most of your 401(k), 403(b), or similar employer retirement plans.
- After age 50, consider making catch-up contributions each year.
- If your employer offers a match, take advantage of it; it’s an instant return on your investment.
- Complement that with IRAs or Roth IRAs for tax diversification.
| Plan Type | Base Contribution Limit | Catch-up / Age-based Adjustments* | Total Possible Contribution (if eligible) |
| 401(k) / 403(b) / 457 plan (employee elective deferrals) | $23,500 | + $7,500 (for age 50+) + $11,250 for those aged 60–63 (if plan allows) under SECURE 2.0 | Up to $31,000 for ages 50+ (standard catch-up) Up to $34,750 for ages 60–63 (if “super catch-up” permitted) |
| 401(k) / 403(b) / 457 (total with employer contributions) | $70,000 | Catch-up contributions do not count toward this 415(c) limit | – |
| Traditional & Roth IRA | $7,000 | + $1,000 (for age 50+) | Up to $8,000 |
| SIMPLE IRA / SIMPLE 401(k) | $16,500 | + $3,500 (age 50+) | Up to $20,000 |
| SEP-IRA / Defined Contribution (employer) | Up to $70,000 or 25% of compensation (whichever is less) | — | — |
| Defined Benefit Plan (annual benefit limit) | $280,000 | — | — |
- Diversify Beyond Stocks
As a Gen Xer, you may have spent the past few years building wealth primarily through the stock market, often in 401(k)s, IRAs, or brokerage accounts that are heavily tilted toward equities with some bonds added in. While stocks have fueled long-term growth, relying on them alone can expose your portfolio to sharp market corrections and sequence-of-returns risk, especially as retirement draws closer.
Pro Tip: Sequence of returns risk refers to the risk of receiving poor investment returns at an inopportune time (late working years or early retirement years).
Diversifying beyond stocks with increased exposure to fixed income, real estate, and alternative investments can create greater stability, generate higher revenue for reinvestment or distribution, and provide a hedge against inflation. A well-structured mix of asset classes can make a meaningful difference in both performance and peace of mind over time.
Navigating the transition from accumulation years to preservation years and expanding your portfolio beyond stocks isn’t just smart investing; it’s strategic longevity planning. Working with experienced CFP® professionals and financial planners in Washington, DC, can help you evaluate a variety of opportunities across traditional and alternative markets, balance risk and return, and align your portfolio with your financial goals and meet your retirement timelines.
- Build Tax Efficiency
Here are some of the most popular ways Gen X investors can build greater tax efficiency into their long-term wealth strategy while laying the groundwork for generational wealth.
Consider Roth Conversions: Roth conversions can provide tax-free income in retirement and future flexibility for heirs. For high earners, consider Backdoor Roth or Mega Backdoor Roth strategies where appropriate.
Use Tax-Loss Harvesting and Asset Location: Offset capital gains by realizing losses in taxable accounts, and place less tax-efficient assets (like bonds or REITs) in tax deferred accounts. Keep more tax-efficient ETFs, index funds, or individual stocks in taxable accounts to help minimize taxes on dividends, interest, and realized capital gains.
Incorporate Charitable and Estate Planning Strategies: Charitable vehicles like Donor Advised Funds (DAFs) or Charitable Remainder Trusts (CRTs) can reduce taxable income and capital gains taxes while supporting causes that matter to you and your family. Gifting appreciated securities instead of cash can also shrink your taxable estate.
Plan for Inheritance and Step-Up in Basis: Thoughtful estate planning can help future generations inherit assets more efficiently. Leveraging trust structures, life insurance, and strategies such as the step-up in cost basis can help prevent unnecessary taxation when wealth is being transferred.
Coordinate Investments with a Tax Advisor and CFP® Professional: Tax efficiency isn’t just about minimizing taxes today; it’s about aligning your investment and withdrawal strategies across decades. Working with a financial planner in Washington, DC, and a tax professional can help integrate investment management, estate planning, and retirement income strategies for a unified, multigenerational plan.
- Leverage HSAs as Long-Term Tools
If you qualify for a Health Savings Account (HSA), it’s one of the most tax-friendly tools out there. Your contributions are tax-deductible, the money grows tax-free, and withdrawals for qualified medical expenses are also tax-free. Once you turn 65, you can even tap it for other costs, essentially turning it into an extra source of retirement income.
- Make Debt Work for You
Consider refinancing high-interest debt, paying down variable-rate balances, and utilizing mortgage equity strategically, such as through downsizing or investing in rental properties. Debt isn’t always the enemy; unmanaged debt is.
- Prioritize Estate and Legacy Planning
Building generational wealth means thinking beyond your lifetime. Update wills, establish trusts, and clearly name beneficiaries, especially when you encounter an unexpected life event. Legacy planning in Washington, DC, involves understanding local estate and inheritance tax nuances. In other words, the small details that can make a substantial difference.
- Invest in Education
Funding education for kids or grandkids can be part of your generational wealth strategy. Explore 529 plans or custodial accounts, but maintain a balanced approach so your own retirement stays on track. Remember, there are no scholarships for retirement!
- Explore Additional Income Streams
Consulting, rental income, or side ventures can diversify income and reduce reliance on positive investment returns. Every additional stream adds flexibility and resilience.
How Brown|Miller Can Help Create Your Roadmap for Generational Wealth
At Brown|Miller Wealth Management, our team of CFP® professionals in Washington, DC, helps Gen X clients build customized strategies that connect today’s priorities with tomorrow’s legacy.
We integrate investment management, retirement planning, and estate coordination into a single, comprehensive plan. Your legacy doesn’t happen by chance; it happens by choice.
Schedule a complimentary conversation today with Brown|Miller Wealth Management and start building your generational wealth strategy for the decades ahead.
