Many Older Workers Lack Retirement Funds

Americans near retirement age are still paying off debt rather than saving for retirement

Many Older Workers Lack Retirement Funds
September 12, 2016

The Government Accountability Office recently released information showing that more than a fourth of all those over the age of 55 are lacking a retirement plan or savings plan. The report noted that 29 percent of these families are unprepared for retirement due to several factors. Some did not plan out their savings, while others have had too much debt to pay off and were unable to set aside money.

Even those who have saved are not truly prepared. The average savings for those between the ages of 55 and 64 is a little over $100,000, which will give them only about $300 a month in retirement income. Workers between 65 and 74 will fare a little better, but they still have only enough savings to provide roughly $650 a month. While these retirees may also benefit from Social Security payments, they can still expect to have a very limited budget.

Some workers will have access to employer retirement plans, but many do not. Pew Charitable Trusts reports that about 30 million people over the age of 55 do not work for an employer that offers a retirement plan. This does vary from state to state and industry to industry, with those living in certain areas and working in certain sectors having more access to retirement savings than others.

Due to this lack of retirement benefits, Pew and other financial advisors recommend that individuals begin saving for retirement as early as possible or risk ending up with little to nothing for their golden years.

Let the free MoneyTips Retirement Planner help you calculate when you can retire without jeopardizing your lifestyle.

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