Wealthspire’s Zach Mangels helps Gen Xers plan so that they can simultaneously help support adult children, care for ageing parents, and cope with potential job loss.
5 min
Gen X families, including affluent ones, face a hornet’s nest of financial challenges, from helping out their adult children to providing care for ageing parents to managing careers in a perilous job market.
Zach Mangels, a senior vice president at Wealthspire Advisors in San Rafael, Calif., estimates a quarter of his clients are in the Gen X demographic.
“Mortgage rates are higher, carrying costs are higher, educational costs are higher, groceries are higher, eldercare is higher—all of that stuff eats into cash flow. And even people with higher incomes are feeling that,” says Mangels, 40.
Barron’s Advisor spoke with Mangels about the financial challenges facing his Gen X clients, people between the ages of 46 and 61.
Mangels touched on how he creates short-term plans for clients concerned about career setbacks, why he recommends boundaries for Gen X parents who want to financially support adult kids, and how he guides clients with ageing parents.
Typically, when you create a financial plan, you’re looking at long-range goals.
But now I look at more immediate needs because of the pressures Gen X families are dealing with.
For example, I see more clients whose children are coming back home after graduating from college, needing financial support for a much longer period of time than previous generations expected to receive.
If they need to support their child, I want to understand the nature of what the support will look like.
I have a client whose kids just graduated and whose majors don’t lend themselves to a high income right now.
They knew their kids would be coming back home after graduation and we talked about what the nature of their help would look like.
First we looked at their financial plan to see what kind of support they could provide and we defined the maximum amount.
Then we designed the support in a way that would be planned, explicit, and with purposeful boundaries.
That’s very important for the younger generation. Parents need to know how to help their kids without them becoming dependent.
The children need to have agency and to know they don’t have access to an unlimited piggy bank.
The clients had a conversation with their kids about what to expect.
The kids could live rent-free for three years, with a small stipend, an amount that didn’t disincentivise them from looking for a job.
In this environment, entry-level jobs are increasingly hard to come by, but any job that moves you closer to a career you want is worth looking at. In this case, their daughter got a job as an assistant to a personal shopper, which was related to the direction she wanted to follow.
I didn’t provide a ton of details to the parents with what exactly to say. But I coached them on the basics—having a clear, purposeful, intentional conversation and getting buy-in from their kids.
The cost of long-term care for seniors has increased dramatically.
One of the conversations I have with my clients is how they perceive their parents’ financial circumstances and to what degree they might have to provide a layer of financial support. My dad was in memory care for a few years and we paid maybe 15 grand a month.
My clients’ parents are usually relatively stable financially. But the most important issue is the use of the family residence to help provide support. A lot of people in California who have owned homes a long time have a lot of equity in those homes. That’s the ultimate backstop, the last line of defence.
Gen X is also dealing with career and income volatility. We’ve seen all the headlines about tech layoffs and the rise of AI. A lot of my clients work in the tech industry.
The conversations I have more frequently focus on clients’ concerns about their ability to continue earning at the same level.
We look at diversifying their equity component more quickly, getting it out of company stock, especially for those in tech.
For example, some clients at Amazon have restricted stock units they can sell periodically. But now they’re selling those (Amazon) stocks and then deploying the [cash into other equities] more slowly.
We’re hearing about how quickly AI is going to change things. For people in software on the front lines, they’re pretty anxious about it.
One client who works at Google told me he expected a lot of change with AI as the disruptive force.
A few companies will benefit, he feels. A lot won’t. So he’s actively selling his company shares.
Historically we would reinvest the proceeds as they’ve come in. But now he wants to slow that down. Hold cash a little bit longer and slowly deploy it.
His perception is that change is coming quickly. He doesn’t know what that will look like but it probably won’t be good.
In behavioural finance, we know you feel a loss much more significantly than you feel a gain. And he’s trying to avoid putting money in the market right before there is a big correction.
It’s super stressful. And as we go into 2026, especially in the tech sector and among those with high incomes, I see a lot of anxiety.
I have another client who works in finance, but the nature of his job moves with economic cycles.
He was laid off at the start of Covid and he’s getting nervous again. It’s a “vibecession” that a lot of people are feeling right now.
Over a year ago, we restructured where his investments are held, so that if he gets laid off and ends up spending his emergency fund, the next thing he’ll tap is a more conservative account we created.
It’s not that we took his overall asset allocation and made it more conservative. We just put more investments in this other account. It’s a matter of asset location and it gives him peace of mind knowing he has a fallback he can tap.
That strategy would be helpful for anybody today. The challenge is if you have accounts with a lot of capital gains.
My work with baby boomer clients often involves conversations about supporting their Gen X and older millennial children.
I’ve seen a lot of parents and grandparents of Gen Xers looking for ways to accelerate their generational wealth transfer, trying to provide assistance now when it’s more impactful on their kids’ lives.
For example, a baby boomer client was looking for ways to help her Gen X son, who is married with a child in middle school, but had started accumulating a lot of debt after he was laid off.
We worked together to model the level of support she could provide and how to structure the assistance so it wouldn’t impact her son’s sense of independence.
Ultimately, she decided on a one-time gift that would cover about six months of living expenses. I call this indirect Gen X planning.
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Strong family financial planning can help reduce taxes and support younger generations. From intrafamily loans and asset gifts to inheritance disclaimers, strategic cooperation can create meaningful financial benefits—when families have the trust and structure to make it work.
4 min
Happy is the family whose members—parents, grandparents and grown children—trust each other enough to cooperate on shared goals, especially financial ones. When that is truly the case, Uncle Sam’s tax rules can help as well.
This matters especially now that mortgage rates are above 7%, and many families are looking for ways to help younger members. If the elders have resources and are confident younger ones can cooperate, a family loan could make homeownership possible while providing the elders with a useful income stream.
Other strategies can actually lower taxes, such as when funding 529 plans or Roth IRAs, or when someone inherits a traditional IRA with required withdrawals larger than they will need.
Here are three strategies useful for functional families.
It is perfectly legal for families to lend money to a relative for a down payment or even a private mortgage.
But it is important not to cut corners, says Ryan McKeown, a CPA with Modern Wealth Enhancement in Minnesota. If the loan is for a down payment, be honest with the mortgage provider and have a formal agreement. The lender owes tax on the interest payments received.
If the loan is for a private mortgage, both sides should have legal representation with a formal written agreement, including payment terms. The lender owes tax on the interest, and the borrower often can deduct it if he or she itemizes.
To avoid IRS trouble, the interest rate shouldn’t be lower than the agency’s Applicable Federal Rate at the time of the loan. Currently that is about 5% for loans longer than nine years; about 4.5% for loans three to nine years; and about 4% for loans three years or less. Currently, traditional mortgage rates are generally above 7%.
In addition, the lender could use the $19,000 annual gift-tax exemption (described below) to forgive some or all of the interest or principal annually. If both lenders and borrowers are married, that is up to $76,000 a year. There is no tax for the borrower on such forgiveness, because it is from a gift.
If you’re going this route, McKeown advises against having a fixed plan to forgive the debt. Instead, do it in one-off letters specifying the amount—and keep careful records. Otherwise the IRS might try to treat the loan as a taxable gift.
Powerful tax-saving moves for families often use gift-tax provisions. Under current law, anyone can give anyone else up to $19,000 of assets annually, free of gift tax. That means a married couple with three grandchildren could give them a total of $114,000 in 2026.
The gifts can be cash or other assets, like stock. For noncash gifts, the cost basis—which is the starting point for measuring taxable gain after a sale—“carries over” to the recipient. So if someone buys $1,000 of stock and gives it away when it is worth $5,000, the recipient’s cost basis is $1,000. If the recipient later sells the shares for $8,000, the taxable gain is $7,000.
Here’s an example showing how gifts could save a family taxes. Grandma is a widow of modest means, while her child and spouse have prospered. The couple has two children, and they want to contribute $5,000 to a 529 college-savings plan for each—but they need to sell stock to do it. Their tax rate on the sale would be 18.8%, and they would need to sell about $11,000 of stock.
However, Grandma’s federal tax rate on the stock sale is 0%. If the couple gives $10,000 of shares to Grandma, she could sell them, pay no tax, and fund the grandchildren’s 529 plans. This saves about $1,000 of tax.
These moves are legal, and they could be used in other ways, such as to help a young person fund a Roth IRA.
But trust among family members is essential: Under the law, givers can’t put conditions on a gift. Grandma could use her stock proceeds to take a cruise, but she makes 529 contributions instead.
Mark Sellner, a retired tax attorney and CPA living in Sarasota, Fla., uses this strategy. His children sell stock he gives them and fund 529 plans for his grandchildren.
The family’s tax savings aren’t huge, but he likes other benefits. The sales by his children don’t boost his adjusted gross income, which in turn could raise his Medicare Irmaa premiums or his 3.8% surtax on net investment income.
Sellner doesn’t worry about his children using the funds for another purpose.
“There can’t be any strings attached to gifts. Of course, it is up to us to decide whether to make them in the future,” he says.
Two caveats: The “kiddie tax” applies to most children under age 24, and it is levied at the parents’ rate on investment income above $2,700 in 2026. Consider this before making gifts to a young person.
Investors who give away stock also forgo the step-up, an important provision that exempts assets held at death from capital-gains tax.
Sellner knows he’s losing a step-up, but says, “The children could use a little more now. Why should they wait 20 years to get it?”
A disclaimer is a highly useful strategy in which one heir renounces an inheritance in favor of another heir. Assuming family members cooperate, this can save taxes.
Here’s one example. Dad died and had a large traditional IRA that he left to Mom. She has enough assets and income to cover her expenses, and she lives in a state with a stiff estate tax. The inherited IRA would put her estate over the threshold.
Also surviving are three young-adult children. If Mom disclaims all or part of Dad’s IRA within nine months of his death, that amount could go directly to the children. They will have 10 years to empty the account, and the family as a whole will likely save estate and income taxes.
Disclaimers have many key details, especially regarding beneficiary documents. Although heirs have great freedom in choosing what assets to disclaim, the rules about who gets disclaimed property are rigid. It is best if the original owner names tiers of heirs so that if one disclaims, the next recipient is clear.
