Baby boomers are aging well, but their finances are suffering. Research has discovered that most senior citizens in America worry about their finances and retirement. It’s true, America has a debt crises and the government has a spending crises. However, the looming retirement crises are a topic no one wants to discuss. Senior citizens want to take control of their financial futures to enjoy a comfortable retirement. However, most are shocked to learn about the facts listed below.
- Right now, there is somewhere around 40 million senior citizens in the United States. By 2050, that number is projected to skyrocket to 89 million.
- 25 percent of all Americans in the 46 to 64-year-old age bracket have no retirement savings at all.
- 26 percent of all Americans in the 46 to 64-year-old age bracket have no personal savings whatsoever.
- 46 percent of American workers have less than $10,000 saved for retirement.
- 60 percent of American workers said the total value of their savings and investments is less than $25,000.
- Half of all Baby Boomers say that their household financial situations have deteriorated over the past year.
- 67 percent of all American workers believe that they “are a little or a lot behind schedule on saving for retirement”.
- Today, one out of every six elderly Americans lives below the federal poverty line.
- Between 1985 and 2010, the percentage of Americans in the 65 to 69-year-old age bracket that were still working increased from 18 percent to 32 percent.
- Back in 1991, half of all American workers planned to retire before they reached the age of 65. Today, that number has declined to 23 percent.
- 70 percent of all American workers expect to continue working once they are “retired”.
- 40 percent of all Baby Boomers plan to work “until they drop”.
- 56 percent of American retirees still had outstanding debts when they retired.
- Elderly Americans tend to carry much higher balances on their credit cards than younger Americans do.
- Americans that are 55 years of age or older now account for 20 percent of all bankruptcies in the United States.
- Between 1991 and 2007 the number of Americans between the ages of 65 and 74 that filed for bankruptcy rose by a staggering 178 percent.
- Medical bills are a major factor in more than 60 percent of the personal bankruptcies in the United States.
- More than 61 million Americans receive some form of Social Security benefits. By 2035, that number is projected to soar to a whopping 91 million.
- The Social Security system is facing a 134 trillion dollar shortfall over the next 75 years.
- The number of Americans on Medicare is expected to grow from 50.7 million in 2012 to 73.2 million in 2025.
- Medicare is facing unfunded liabilities of more than 38 trillion dollars over the next 75 years.
- Only 10 percent of private companies in the U.S. provide guaranteed lifelong pensions for their employees.
- In California, the Orange County Employees Retirement System is estimated to have a 10 billion dollar unfunded pension liability.
- The state of Illinois has accumulated unfunded pension liabilities of more than 77 billion dollars.
- The state of California has 325 billion dollars in combined unfunded pension liabilities.
- In 2010, 28 percent of all American workers with a 401(k) had taken money out of it at some point.
- Today American workers are pulling about 70 billion dollars in early withdrawals out of their 401(k) accounts every single year compared to 30 billion in 2004.
- Today, 49 percent of all American workers are not covered by an employment-based pension plan at all.
- 88 percent of all Americans are worried about “maintaining a comfortable standard of living in retirement.”
- American workers are $6.6 trillion short of what they need to retire comfortably.
Over the next 19 years, millions of baby boomers will be retiring. Unfortunately due to the statistics listed above, most will be forced to remain in the workforce for several years afterwards. Meanwhile, millions of working Americans are either, not saving enough for retirement, withdrawing from their 401k early or simply not saving any funds at all for their future. It is obvious retirement savings plans need to be strengthened. However, there has to be a solution that involves more than working more years and shortening the length of retirement.
National Council of Aging: https://www.ncoa.org/news/press-releases/
Social Security: https://www.ssa.gov/policy/docs/quickfacts/stat_snapshot/
The Orange County Register: http://www.ocregister.com/taxdollars/strong-478596-percent-county.html
Business Insider: http://www.businessinsider.com/drawbacks-of-401k-loans-2013-1