These Statistics About Retirement Should Terrify You

A tight budget for living expenses like food and gas makes planning for retirement a daunting undertaking. A few critical and sobering retirement realities may also have escaped your attention. Preparing for retirement will help you avoid making careless financial mistakes as you plan for your post-work years. This article seeks to clarify some of the challenging realities of retirement so that you may make the necessary plans.

According to the Retirement Industry Trust Association, women save $57,000 on average for retirement. However, the average amount of savings held by men is $118,000 instead. Women may find it more challenging to retire than men and may need to put in more time at work to accumulate enough savings for a comfortable retirement.

Do you know how much money you need in retirement funds to quit your job permanently? You are not the only one if the response is “no.” According to the Retirement Industry Trust Association, 43% of American workers claim they are merely guessing when determining how much they need to save for retirement. Make an expected budget for your retirement expenses rather than winging it. Remember to factor in one-time costs like vacations and regular bills like housing and utilities. As you move closer to retirement and your goals change, you should consider reviewing your budget every few years.

According to the Retirement Industry Trust Association, 47% of baby boomers have already retired. However, only 11% of boomers reported having at least $500,000 saved up in retirement savings accounts in 2019, just before the COVID-19 epidemic. Retired Americans may believe that Medicare will pay for their medical expenses. However, that is untrue.
In fact, according to research from Fidelity Investments, a typical retired couple that is 65 years old and retired in 2024 may require an estimated $315,000 in retirement funds to pay medical expenses throughout retirement.

Medicare doesn’t start paying for medical costs until you turn 65. Fidelity Investments, however, estimates that the U.S. average retirement age is 62. Thus, there is a three-year gap between the typical retirement age and the start of Medicare. These people will need to have health insurance of some kind, and it may be necessary to use retirement money to pay for it.
Medicare won’t pay for all of your medical costs, even after it starts. Therefore, when you make a retirement budget, take any additional payments for health insurance into account.

To save money for retirement, you might be making contributions to a 401(k) or 403(b) plan. But what follows?
In fact, according to the Employee Benefit Research Institute, 37% of workers aged 25 and over say they are still determining where to turn for assistance with retirement planning. And the same worry has been voiced by 19% of retirees. Consult a financial planner right away to explore your possibilities as you consider your retirement future. To find out if financial planning is offered as a part of your retirement benefits package, speak with the human resources department of your employer.

It might not be very comforting to start retirement planning, and planning in advance might help you better grasp how much money you’ll need to set aside to augment your Social Security benefits later in your later years.
It would be best if you always planned how you’d spend money in retirement so that you can take the time to enjoy the fruits of your life labors accordingly