In the near future, you will finally reach a goal that you’ve envisioned for years. It will be time to retire! Hopefully you’re feeling confident about your plans, but checking in on the status of current retirees’ lives can help you to make any necessary last-minute adjustments.
Currently, the average age of retirement in the US is 66. Since the average person lives 78.7 years, the average retirement will last about 12 years or so. Of course, the word “average” is very important here. Quite a few people will deviate from the norm, and sometimes significantly. Many retirees will enjoy a retirement that lasts 20 years or more, so plan accordingly.
As it turns out, 81 percent of us are doing exactly that. They’re preparing for a longer retirement with maximizing their retirement plan contributions and purchasing secured life insurance policies. At the same time, they’re reducing their cost of living so that their retirement income stretches farther.
However, not everyone is beefing up their retirement plans right now. Of Americans in their forties, 46 percent report that they’ve made early withdrawals from a retirement plan. That means nearly half of us have made a mistake that can incur financial penalties and put a significant dent in accumulating interest over time.
Will they have time to catch up? Unfortunately, 50 percent of current retirees say that they felt forced to retire earlier than originally planned. If a layoff, illness, or other emergency strikes, anyone could end up retiring early.
And then there are those who are still not planning for retirement. A third (33 percent) of working Americans lack a retirement plan. Are they counting on Social Security to cover expenses in retirement? That would be a mistake, because the program was only intended to serve as supplemental income. And since Social Security benefits are calculated based upon years of earnings, those with lower incomes will also draw smaller checks in retirement. Those might be the very same people who don’t have a retirement plan.
Finally, even if you’re saving, you might not be saving enough. The median retirement account is worth about $107,000, which amounts to about $310 monthly if you were to invest it into an inflation-protected annuity.
These statistics aren’t meant to alarm you, but just to inform you on the status of retirement planning nationwide. If you’re concerned, you’re certainly not alone. But do call us to schedule an appointment, and we can assess your current retirement plan and help you decide if anything needs to change.