Retirement happiness is looking less and less real
If you thought retirement was a cake walk, you might be heartbroken to learn there’s more walking than cake.
Nearly half of all Americans — 49 percent — don’t believe they will reach their retirement goals by the time they hit actual retirement age, the American Institute of CPAs says. Of the more than 1,000 adults surveyed, 5 percent of non-retirees have reached their retirement goals.
The higher the lack of confidence, the higher the anxiety level for non-retirees. The biggest sources of their financial anxiety: healthcare costs (71 percent), unawareness of personal health (62 percent) and being unsure about tax rates (52 percent).
Being poor in retirement isn’t anything new, and those delightful golden years are looking more like bronze as low income is not only contributing to anxiety, but also depression and loneliness in older Americans.
“Working throughout your life was once a reliable route to a comfortable, financially secure retirement. Over the years, Americans have been asked to take on more responsibility and become more self-sufficient when it comes to their retirement planning,” says Greg Anton, CPA, CGMA, and chair of the AICPA’s National CPA Financial Literacy Commission. “We’ve found that today, even Americans who say they’ll reach their financial goals are anticipating a more active ‘retirement-lite’ that involves working and making financial sacrifices.”
The biggest financial sacrifice among non-retired Americans is nearly half — 45 percent — expect to work full-time longer than they expected. Another 43 percent believe they’ll be working in some capacity, probably part-time, during retirement age. Forty percent think they’ll have to move to a less-expensive city and another 28 percent believe they’ll have to forego medical care.
“As life expectancies have gotten longer, retirement planning has become more difficult,” the AICPA survey says. “For non-retired Americans, anxiety over Social Security and a sharp decrease in company pensions may have led to an increased emphasis on personal savings.”
Health care during retirement is hurting us
As we get older and turn to our retirement to financially support us, many of us are genuinely afraid that we will run out of money before we die. Money is already a big source of financial stress, but specifically having enough money in retirement to help us when we may not be able to work is the biggest financial stressor of all.
Long-term health care is expensive in most places around the country, although some places have it cheaper than others. Where you live shapes the cost of living, even if you’re just moving into an assisted living facility. It can range on the low end, like $68,000 a year in Louisiana, to $200,000 in Alaska.
Aside from where you live, your gender matters as well. Because women are expected to live longer than men, it’ll cost them more than $35,000 extra just for being an old woman. This is an even bigger burden on women as they are already facing earning less money and not being able to close the gender pay gap for more than two centuries. Aside from earning less income, women, on average, are also collecting less Social Security. Less earnings and less savings mean less money in retirement.
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Article last modified on August 30, 2017. Published by Debt.com, LLC . Mobile users may also access the AMP Version: Americans are Stressing Over Retirement Savings Hardship - AMP.