Most People Aren’t Going to Make It, But You Can
In March of 2016, this article was published and it has some scary statistics about Americans and their retirement savings:
- One third, yes 1 in 3, have $0 saved for retirement
42% of Millennials have not yet started saving
52% of Gen-Xers have less than $10k saved
Only 1 in 4 Boomers have over $300k saved
According to the Social Security Administration, the average monthly benefit is $1,418. For simplicity, let’s round up to $1,500/month. If you are a couple in your late 60s, your annual income might look something like this:
$1,500/month x 2 people = $3,000/month
This amounts to $36,000/year
Let’s also pretend that you are one of the four Boomers who has over $300k saved; let’s say $500k is saved. If you use a simple 4% withdrawal, this would be an additional $20,000/year. Your annual income would be $56,000 for you and your spouse. Is that enough to live on?
Obviously, it depends on where you live and what kind of life you want to live. In northwest Ohio where I live, this would be enough to live on for a year and you could take a trip or two, spoil your grandkids, and maybe save up for one huge exotic trip or other major expense. But that would be about it.
But… this is only going to be true for 1 in 4 American Boomers. This would be the best case scenario for this group of Boomers. But what about the other 75% of American Boomers? And what about the Gen-Xers or Millennials?
As an investment adviser, these statistics are very concerning. If we extrapolate out the figures, it would seem that most people just aren’t going to make it financially.
This is the bad news. The good news is that anyone 60 or younger statistically still has a chance to turn things around. And the younger you are, the better off you could be.
You don’t have to be another American who didn’t end up saving enough for your future. You can begin today. Today can be the day you get back on track with your finances.
If you need help getting on track or back on track, I would love to talk with you. There are steps you can begin taking right now that can have impact on the rest of your life and the legacy that you want to leave behind.
