Retirement is a topic that regularly makes headlines, and not all of them are encouraging. Americans are living longer than ever before. However, if you assume most people are saving more to prepare for their longer-term needs, you’d be mistaken.
- It could last longer than you think - the average American will retire at age 66 and live until nearly 79. However, for many, retirement will last much longer than 13 years. The numbers are skewed by the number of individuals who die relatively young.
- Social Security falls short - a lot of financial advisors recommend replacing 80% of your usual income once you hit retirement. Most of the time, Social Security payments alone won’t be nearly enough to hit that target.
- Americans are way behind on savings - as the American workplace turns away from pension plans, the onus is increasingly on workers to secure their own retirements. The fact is, though, relatively few succeed.
- Only half have a retirement plan - it used to be that you could spend most of your career at one company and count on a pension once you reached retirement. Today, however, the median annual pension amount for the dwindling number of Americans who have the old-fashioned defined-benefit plan is only $9,376.
- Many are staying in the workforce - given the fact that so many Americans are behind in their savings, perhaps it’s not surprising that many remain in the workforce well after reaching Social Security eligibility.
- Medicare won’t cover assisted living - government data reveals that nearly 70% of individuals who reach age 65 will need long-term care at some point. What many seniors don’t realize is that Medicare doesn’t pay for most long-term care costs.