– many workers plan to work up until they are 80 well beyond the typical life expectancy of Americans. How long will $25,000 last in retirement?
Posted by mybudget360The romantic concept of being able to retire on a sunny beach with endless drinks is a modern notion largely pushed by mainstream advertising. It is hard for many middle class Americans to imagine a world where retirement is a luxury for the very few. However that is the path we are now following.
The ability to retire is being severely impaired for most Americans given their lack of savings but also the massive spending occurring by the government. Recently we have heard that Social Security is expected to run out of funding far quicker than was once expected. This information in itself is troubling but couple that with the incredibly low to non-existent savings rate for younger Americans and you realize the day of reckoning that is lining up. Even recent data has looked at pushing the retirement age from 65 to 80 for some workers which might be hard to do given it is beyond the normal life expectancy of most Americans. The new retirement model appears to be no retirement.
The sources of retirement support
An interesting survey by Wells Fargo highlights the big changes coming in the concept of retirement for Americans. What it finds is that younger Americans are going to be less reliant on Social Security and pensions (not by choice) yet these same workers are largely funding the retirement of the 1 out of 3 current retirees that largely depend on Social Security for their income:
Source: Wells Fargo
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