Have Boomers set aside enough funds for retirement? Researchers are suggesting their savings are not sufficient. Relying on Social Security is not a good idea because of its impending insolvency. The overall outlook for aging baby boomers appears grim.
Millions of Americans are still facing a dismal outlook when it comes to their own ability to retire.
Statistics to support current retirement conditions:
1. The expected retirement age is now up to 67 from a previous 63
2. According to AARP 40% of baby boomers consider working until they die
3. The Employment Benefit Research Institute notes 46% of Americans have less than $10,000
saved for retirement.
4. Lifehappens.org reports a dismal 87% of adults feel they will not have a comfortable
retirement.
5. CNBS recorded 36% of Americans state they don't contribute anything to their
savings by an average of $117,000
6. Ameriprise surveyed 50 - 70 year olds about their cash savings and found that
90% had experienced a significant economic life event that negatively impacted
their retirement savings by an average of $117,000.
7. The Great recession created low interest rates which impaired the growth
of retirement assets
8. The market has declined by 55% and home equity 33% while 23% reported having
to support grown children or grandchildren
Why has American retirement dreams been depleted?
Most respondents to the surveys point to increasing cost of living expenses preventing them from saving. Included in the saving problem is rising healthcare and long-term care expenses.
In addition to the rising expenses it the fact that the dollar doesn't go as far as it once did because of practices by the Federal Reserve.
Putting money in the bank is probably the largest retirement mistake. Inflation destroys 50% if you let it stay there for 22 years. Your money has to work for you, not the bank.
The traditional forms of investment like CDs, bonds and money markets pay less than 85% less than they did just six years ago.
Tax increases implemented by the Obama Administration further complicates matters.
The United States retirement system has earned a "C" rating from the consulting firm Mercer, as compared to the "A" grade Denmark received and the Netherlands' retirement system's B+ rating. The study further shows that other countries are willing to make unpleasant steps by workers and employers to fund a stable system.
The United States Social Security trust fund is expected to become insolvent in 2033.
As Social Security dwindles, retirees will need to look at other resources like home equity to fund their retirement.
For the first time in history less money will be available and alternative sources of income will need to be established.
Despite a drop in home values since the recession 21% of Americans expect to rely on the equity built up in their homes as a source of income.
Attempting to retire without social security requires a lot of planning, saving and investing. It's important to plan well to create a successful retirement plan.
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