With the bulk of the Baby Boom generation heading into retirement well into the next decade, more than half of Americans 55 and older have no retirement savings, according to a new report by the U.S. Government Accountability Office. This could be a real issue as not only do you have less of an income during retirement, you also have additional expenses to pay, for example, if you need to pay for a care home like Immanuel Fontenelle.
Fifty-two percent of Americans haven’t saved anything, despite nearly half of them having access to an employer pension plan. When you think about it with these statistics, ensuring you have a retirement account will be something that will work out in your favour as you get older, especially since your retirement funds will help you live your best life after your career. If you don’t have any money or enough, you may find it difficult to fulfil the goals you had set yourself once you retired. With this being said, it may be worth checking out companies such as The Entrust Group for more information regarding retirement accounts and find out how you can take control over your investment choices.
Among those with some retirement savings (the remaining 48 percent), the median amount of those savings is about $104,000 for households age 55-64 and $148,000 for households age 65-74, equivalent to an inflation-protected annuity of $310 and $649 per month, respectively, the GAO said.Social Security provides most of the income for about half of households age 65 and older.
As baby boomers move into retirement each year, the Census Bureau projects that the age 65-and-older population will grow over 50 percent between 2015 and 2030. This means that services like retirement homes and stairlift contractors will be under a lot of pressure to meet the needs of all the retirees.
Fewer Pensions Than Predecessors
But Boomers (those Americans born between 1945 and 1964) are heading into retirement with fewer pensions than their preceding generations. In 1975, most workers with employer-sponsored retirement plans had pensions that provided a lifetime “defined benefit.” As of 2012, such plans had 40 million participants, while 91 million workers had retirement savings plans such as 401(k)s, which are based on workers’ own contributions and offer no guarantee of lifetime income. Alongside using plans such as the 401(k)s, when it comes to retirement, many people decide to make investments in areas such as stocks, bonds, and even precious metals to help them to have financial security. Not only that, but it can help provide them with some income during their retirement. To be able to start planning for this now, you may want to have a look at these Lear Capital reviews to find out more information about this process and how to set up a precious metals IRA that can store these finances in a safe place. It is important to have financial security during every stage of your life, but it becomes even more important when you have retired.
According to the 2013 Survey of Consumer Finances, two-thirds of households age 65-74 say their received or expected retirement income is at least enough to maintain living standards (66 percent). On the other hand, just over half (52 percent) of people age 55-64 say retirement income they expect or receive will be enough to maintain living standards.
On average, Social Security provides retirees $1,287 per month. But the program’s trust fund reportedly will be depleted by 2034 unless significant changes are made by U.S. lawmakers. At that point in about 19 years, incoming payroll taxes will be able to support about 80 percent of scheduled benefits. Meanwhile, the GAO report found that roughly 40 percent of households aged 65-74 get most of their income from Social Security.