It’s not just young people who are getting screwed by the current economy.
New surveys are finding that a striking proportion of older hard-working Americans no longer harbor aspirations of retirement.
The notion of retirement, once held as a sacred stage of life and a shared expectation in the workforce, now finds itself fading away. A secure and comfortable retirement necessitates diligent savings, and yet, many toil under the weight of insufficient funds.
A poll conducted by Axios and Ipsos in July found an astonishing 29% of workers under the age of 55 boldly declared, “I don’t believe I will ever retire.”
“One in five Americans don’t think they’ll ever retire. Among the people who don’t think they’ll ever retire, a decisive majority (70%) say that they won’t ever retire because they can’t or won’t be able to afford to retire, versus 19% of people who just don’t want to retire (an additional 10% picked ‘other’ as a response),” the pollsters wrote.
In another study by the Employee Benefit Research Institute (EBRI), a staggering one-third of workers now anticipate reluctantly bidding adieu to the workforce at the ripe age of 70 or beyond, or worse, never doing so.
A third report, this one from the Transamerica Center for Retirement Studies, echoed a similar sentiment, revealing that 40% of Generation X employees and nearly half of the Baby Boomer generation had resigned themselves to the prospects of retiring after the age of 70 — or surrendering altogether.
It appears that apprehensions surrounding retirement are on the rise. The EBRI survey unveiled a disconcerting reality; the percentage of workers intending to postpone retirement magnified to 33% in 2023 from 29% in 2022 and just 26% in 2021.
Ironically, the summer of 2023 seems an inopportune moment for Americans to find themselves grappling with dwindling retirement coffers. A substantial 75% of all 401(k) funds lay invested in the ebbs and flows of the stock market, which, at large, is experiencing an upward trajectory, notwithstanding some recent market turbulence.
Census data reveals a staggering statistic: more than 40% of Baby Boomers aged 55-64 have no retirement savings. Reasons range from limited options in small companies to being self-employed or lacking the means to save. A NerdWallet analysis shows that this age group’s median retirement savings account sits at a modest $71,168. However, this falls woefully short of the commonly accepted wisdom that workers will need around $1.8 million for a comfortable retirement, as revealed in a recent Charles Schwab survey.
As if this weren’t concerning enough, many Americans express doubt about their ability to live comfortably in retirement. According to the 2023 EBRI survey, 36% of respondents have little or no confidence in their financial security after retirement. Alarmingly, this figure has increased from 27% just a year ago.
The picture is no brighter for Generation X workers, with only 17% feeling “very confident” about their retirement prospects, according to Transamerica research. It’s worth noting that the oldest members of this demographic are nearing the age of 60.
Amidst these sobering realities, it’s clear that urgent action is needed to address the retirement crisis in the United States.
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