That's the news from Lake Wobegon, where all the women are strong, all the men are good-looking, and all the children are above average. -- Garrison Keillor on the "Prairie Home Companion" radio show.
There's a lot of optimism in America and elsewhere -- and it sometimes conflicts with reality. Consider a study conducted for AAA in 2017 that found 73% of drivers considered themselves better-than-average drivers, while more than 90% of vehicle accidents are caused by human error. Similar quandaries exist in the financial world, -- where, for example, many people hope to live long lives while not planning to retire later and often not having sufficient savings.
According to the CDC, the overall life expectancy is only around 74.8 years for men and 80.2 years for women. Per a survey from Corebridge Financial and The Longevity Project, though, 54% of respondents affirmed wanting to live to age 100. Of course, relatively few of us will achieve that, but the number of centenarians is expected to quadruple from around 101,000 in 2024 to 422,000 by 2054, according to data from the U.S. Census Bureau.
If you're hoping to reach age 100, or you understand that you might do so, it's smart to try to line up enough money to support you throughout your retirement. But check out how much many of us have socked away, per the 2024 Retirement Confidence Survey:
Amount in savings and investments* | Percentage of workers |
---|---|
Less than $1,000 | 14% |
$1,000 to $9,999 | 8% |
$10,000 to $24,999 | 7% |
$25,000 to $49,999 | 7% |
$50,000 to $99,999 | 11% |
$100,000 to $250,000 | 14% |
$250,000 or more | 38% |
Source: 2024 Retirement Confidence Survey.
*excluding the value of a primary home.
Making matters worse, millions of us are retiring sooner rather than later. Each of us can start collecting Social Security as early as age 62 -- or we can delay doing so up to age 70, which will maximize our benefits (and our future cost-of-living adjustments -- or "COLAs"). However, the most common age for claiming Social Security was recently 65.
If you retire at 65 and you live to 80, that's a 15-year-long retirement. If you live to 100, that's a 35-year-long retirement. Think about how much you have socked away and how long it might last in retirement. (You may want to brush up on retirement withdrawal strategies, such as the flawed but informative 4% rule.) If you're like many folks in the table above and have, say, only $100,000 saved, that's not likely to be enough to support even a 15-year retirement. Yes, there's Social Security, but the average monthly Social Security retirement benefit was only $1,917 as of May -- amounting to only $23,000 over a year.
So what can be done? Are millions of Americans doomed? Not necessarily. There are steps to take that can help your money last longer in retirement. Here are some to consider:
Retirement planning is critical, so take some time to think through issues such as how much income you'll need to retire with and how you'll amass it. Come up with a plan and then stick with it. Don't be afraid to consult a financial advisor, either.
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2024-06-23T07:33:06Z dg43tfdfdgfd