The future of US retirees is looking bleak, as many employed Americans doubt they’ll ever stop working.
1 in 4 Americans
Approximately one-quarter of working Americans over 50 years old doubt they will ever retire, as shared in a recent survey by the American Association of Retired Persons.
Concerning Results
The survey spoke to 8000 Americans and yielded some concerning results. 70% of people over 50 who were interviewed also shared concerns that prices in the US were increasing at a faster rate than their incomes.
No Retirement Savings for 25%
Even more worrying was the news that 1 in 4 participants had no savings put aside for retirement.
Housing Costs Are the Biggest Culprit
Participants pointed to daily living costs, particularly housing. Rent and mortgage payments ate into most of their earnings.
High Credit Card Balance
What’s more, 30% of older adults surveyed reportedly have a month-by-month credit card balance of $10,000 or more. 12% have a balance of $20,000 or more.
Many Americans Worried About Living Costs
The survey, which was released on Wednesday, comes at a time when many Americans, both younger and older, are becoming increasingly concerned about the climbing cost of living, as well as high inflation and interest rates.
“Too Many People Lack Savings”
“Far too many people lack access to retirement savings options and this, coupled with higher prices, is making it increasingly hard for people to choose when to retire,” said the senior vice president of research at the AARP, Indira Venkateswaran.
“The Top Barrier to Saving”
“Everyday expenses continue to be the top barrier to saving more for retirement, and some older Americans say that they never expect to retire,” she continued.
Taking It to the Polls
Retirement prospects for low and middle-income Americans will likely be taken to the voting polls this November, as both President Biden and former president Donald Trump vie for older demographics who tend to vote in droves.
Medicaid and Social Security
The financial viability of both Medicaid and Social Security will be important issues under the next presidency.
“Serious Retirement Crisis”
Nancy LeaMond, the AARP Executive Vice President and Chief Advocacy & Engagement Officer shared that their survey shone a light on a “serious retirement crisis” in America and called on lawmakers to address the ongoing issues in the retirement industry.
Calling on Congress to Act
“America is facing a serious retirement crisis,” she declared. “AARP has a long history of supporting legislation to expand access to retirement savings, but Congress must act more swiftly to provide the financial support older Americans need and deserve.”
“Two-Thirds of States Have Yet to Act”
“We have worked with 19 states to create programs to make it easier for people whose employers don’t offer a retirement plan to be able to save for their future,” LeaMond continued. “But about two-thirds of states have yet to act, and we await action from the federal government.”
57 Million With No Work Retirement Plans
According to the AARP, 57 million aren’t able to get retirement plans through their work.
Unfortunate Statistics
It’s an unfortunate statistic, as the average American is 15 times more likely to put money aside for retirement if they have access to a plan through their workplace.
Only Eight States
Currently, only eight US states have legally enforced automatic IRA plans for employees: California, Colorado, Connecticut, Illinois, Maine, Maryland, Oregon, and Virginia.
Retirement Savings for Americans
Congress is looking to expand retirement security by providing savings accounts to workers who don’t currently have auto-IRA programs, under the Retirement Savings for Americans Act of 2023.
Not All Doom and Gloom
Fortunately, it wasn’t doom and gloom for all participants in the survey. Approximately one-third of the respondents believed their financial situation would improve in the coming year.
AARP and NORC
The AARP conducted the survey alongside the NORC Center for Public Affairs Research, a research center with a focus on public affairs, media, and politics.
Largest Non-Profit for Retirees
On its official website, the AARP describes itself as America’s “largest nonprofit, nonpartisan organization dedicated to empowering Americans 50 and older to choose how they live as they age.”
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The post – A Quarter of Americans Over 50 Fear They Can’t Afford to Retire – first appeared on From Frugal to Free.
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The content of this article is for informational purposes only and does not constitute or replace professional financial advice.
