When you don't save for retirement, your choices become more and more limited as you age. If you don't own your home outright (meaning any mortgage debt) and can't make the payments, then you lose the choices of where you want to live during retirement.
In fact, if you've reached age 65 with little-to-no retirement savings, you're in good company. Some reports claim that as many as 42 percent of Americans retire with $10,000 or less. But there's some good news. Even if you have no retirement savings at age 65, there are things you can do to change that.
It's not recommended to rely solely on social security benefits in retirement, but it can be done. | Social Security was designed to supplement only pensions and retirement savings. But for many, that's no longer the case.
Work During Retirement
One way to retain this lifestyle and retire without savings is to work a part-job in retirement that helps pay for essential expenses but still leaves you with time for other things you want to do when you retire, such as volunteer or travel.
13 percent of Americans 60 years or older did not have any retirement savings as of January 2020. The share of individuals without retirement savings increased with the younger age groups, and among individuals from 18 to 29 years old, 42 percent did not have retirement savings.
Pay Off Debt Before Retiring
To make the most of your Social Security income, it's best to pay off all debts, including credit card bills and mortgages, before retiring. This way you can focus on putting your benefits towards what you need day-to-day, rather than spending it on things you purchased in the past.
Will Social Security still be around when I retire? Yes. The Social Security taxes you now pay go into the Social Security Trust Funds and are used to pay benefits to current beneficiaries. The Social Security Board of Trustees now estimates that based on current law, in 2041, the Trust Funds will be depleted.
Key Takeaways. American workers had an average of $95,600 in their 401(k) plans at the end of 2018, according to one major study.
1. (tie) West Virginia. Like Iowa, West Virginia is another state you might not think of as a retirement destination until you look at the numbers. Affordability is a big factor for anyone on a tight retirement budget, and West Virginia has the fifth-lowest average property tax burden in the country.
About 40% of older Americans rely exclusively on Social Security for retirement income, according to recent research from the National Institute on Retirement Security.
Social Security offers a monthly benefit check to many kinds of recipients. As of March 2022, the average check is $1,536.94, according to the Social Security Administration – but that amount can differ drastically depending on the type of recipient.
However, not everyone receives the maximum amount and if you choose to retire at 65 this year you'll take at least a 10 percent hit on benefits. The average beneficiary who begins collecting from their Social Security retirement fund will receive $1,658 per month in 2022.
But if you can supplement your retirement income with other savings or sources of income, then $6,000 a month could be a good starting point for a comfortable retirement.
The U.S. Census Bureau reports the average retirement income for Americans over 65 years of age as both a median and a mean. In the most recent data from 2019, the figures were as follows: Median retirement income: $47,357. Mean retirement income: $73,288.