LOUISVILLE, Ky. (WAVE) – Retirement rates have been rising rapidly since the pandemic over two years ago. Some have labeled it a retirement crisis as older employees were forced out of the workplace as companies closed or downsized.
Most experts say your retirement income should be about 80 percent of your final pre-retirement annual income.
In other words, if you make $100,000 annually, at retirement, you need at least $80,000 per year to have a comfortable lifestyle after leaving the workforce.
Employees in the workforce were already having trouble making ends meet before they left the workforce, which left many who retired with too much debt and not enough savings.
Cleaver Real Estate, the nation’s leading real estate education platform for home buyers, sellers, and investors, recently surveyed 1,000 current retirees about their retirement finances, debt, and financial security.
The new research study was entitled State of Retirement Finances: 2022 Edition.
Taelor Candiloro is a research analyst that took a deep dive into the numbers to discover the state of retirement today.
“We know that many Americans are living paycheck to paycheck,” Candiloro exclaimed.
When you are doing everything, you can do to make ends meet, saving for retirement can be exceedingly difficult if you are tossing and turning at night wondering how you will cover your bills.
“Without opportunities to put away adequate savings that level of financial stress appears to be following into retirement,” Candiloro proclaimed.
The golden years are often tarnished as retirees wonder how they will make it or if they even can meet their daily needs.
“Sixty-five percent of retirees, they don’t feel financially secure,” Candiloro shared. “45 percent said they waited too long to start saving. 51 percent, so over half, said they believe they’ll outlive their savings entirely which is staggering. 79 percent of retirees reported that they do rely on social security. About 79 percent of retired Americans rely on social security, but that often only covers about forty percent of their monthly bills”
The study recently published by Clever Real Estate also found that one in three retirees have nothing in savings. Retirees often even go into debt trying to pay for basic expenses.
If you believe you are ready to leave the workforce, the first thing you need to do is create your retirement budget and retirement income plan.
“Being realistic about where you are financially is really the first step and the best step you can take for yourself,” Candiloro explained.
If you are young, start planning and stay committed to your retirement plan. Financial security does not just happen. Saving a little is better than saving nothing at all.
“Start saving,” Candiloro stressed. “If you’re not saving, start saving, and it doesn’t have to be a big number. Invest in riskier assets. Make riskier investments. You have a longer time horizon, and if some of those investments don’t do great, there’s still time for them to recover before you retire. Experts recommend that you save if you want to retire at 62 or 67 about ten times your annual income. That’s what you should have in savings when you retire.”
You can never be too busy to plan for retirement and it can never be too soon. Talk to friends and neighbors to find a reputable retirement advisor.
You should get more than one name and take time to talk to more than one company or person before you make your choice.
One effective way to find a reputable retirement advisor is to ask friends and neighbors you trust, as well as other professionals you may know, such as a lawyer or accountant. Ideally, you should get more than one name and interview any potential candidates before you make a choice.
“If you’re able to take a breath and say this is where I’m at and then research and look at your options that’s the best thing you can start with,” Candiloro said.
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