Retirement is not as far off as it seems. Studies on the way our brain ages indicate that as we age, time actually moves faster. Or at least it does it with our brain.
With each passing day, you are approaching retirement faster. Are you ready?
One of the best ways to understand what it takes to retire is to talk to those who are already there. While we like to think of retirement as a time to travel, garden, and have coffee at the local café every morning, it is not usually a carefree time.
One study, conducted by Brightwork Partners for Putnam Investments, looked at retirees aged two to six. These retirees are old enough to have traditional pensions, but still young enough to have 401 (k) s as well.
Traditional pensions are disappearing fast, but that doesn’t give today’s retiree society an advantage over younger generations.
The median annual income for new withdrawals, before taxes, was $ 36,000. Almost 50% reported income of less than $ 25,000, while 25% reported less than $ 15,000 a year in annual income.
More than half of the retirees said their standard of living had decreased since they stopped working. Only 30% said they lived comfortably. Twenty-one percent reported that it is a struggle to make ends meet.
More than 40% of retirees’ annual income came from Social Security. Average income was only 11% of income from savings and investments.
With traditional pensions becoming a thing of the past and Social Security uncertain for future generations, today’s workers must start saving now.
Talk to a retiree and you will see that retirement doesn’t get easier over time. More than 60% of retirees say that the longer they are retired, the more difficult it becomes. Many are surprised to find that maintaining a certain standard of living is quite difficult.
Those who are most satisfied with their retirements are those with the highest income and assets. For example, 50% of those with an annual household income of $ 75,000 are “very satisfied” with retirement.
Most retirees will tell you that they wish they had saved more. Almost 60% wish they had started saving sooner.
What can you learn?
Start saving now and save as much as you can. Don’t be left with the feeling that retirement could have been better or different. Once the time has passed, it will be too late.
Sit down with your finances and start a plan to save for retirement. It doesn’t matter if you can only afford $ 25 a month. The point is that you are returning something. Over time, you may be able to save more. With interest, your savings will grow. And hopefully, he will be one of those “very satisfied” retirees.
