Many Americans Are Not on Track to Meet Retirement Goals

Ideally, American workers would like to retire at age 61, according to a new Bankrate survey of American adults. This may be an overly ambitious goal, considering that the average life expectancy in the United States is approaching 80 years and the majority of workers are not on pace to accumulate savings to cover nearly 20 years of retirement. The survey found that older Americans, perhaps confronting a more immediate view of retirement’s financial challenges, believe retirement should come later. The Silent Generation, those age 73 and older, put the ideal retirement age at 65, with nearly 20 percent saying workers should forestall retirement until after their 70th birthdays.
Complicating the matter is the fact that average 401(k) balance is $103,866, according to Vanguard. But even this figure – which would likely cover only a small fraction of the average person’s retirement expenses – paints a picture that is a bit rosier than reality. The median balance in Vanguard 401(k)s is $26,331, and according to some studies up to a quarter of American workers are putting no money aside for retirement.
Professional insurance and financial advisors help their clients set realistic goals and develop personalized plans to meet those goals, whether they include retiring at a certain age, paying children’s education expenses, or ensuring security in the event of emergencies or financial setbacks.
A survey by PenFed Credit Union found that people who work with financial advisors save nearly twice as much for retirement, as a percentage of their income, as those who lack individual professional advice. Those with advisors save an average of 10.4 percent of their salaries, while those without save 5.5 percent.
Consumers who work with advisors are also more likely to have a personalized, long-term financial plan and to feel confident about their financial prospects during retirement.
  • Posted July 20, 2018 IN

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