There was an interesting series recently on Axios about retirement. I thought I would share some of the facts I found to be a bit eye-opening.
- Over the last 30 years, the percentage of people age 65 and older participating in the workforce has increased from 11% to over 20%.
- The number of people over 64 in the workforce has tripled in the last 30 years.
- During that same time period, life expectancies for both men and women have increased. For men it has grown from 80 to 83.1 years and for women from about 83.8 to 85.6 years.
- Without a doubt, Americans are working longer. Some out of necessity and some out of choice.
- 43% of people 45 years and older expect to outlive their retirement savings.
- 31% of people between ages 40 and 79 said they would continue to work into retirement age even without a financial need to. Not sure why they went all the way to age 79, but okay.
- I’ve mentioned before – there is a financial incentive to work longer. Gives you more time to accumulate assets, more time to let those assets grow, and a shorter time period those assets have to fund a retirement.
- Right now, the average retirement age is 63.
- The poverty rate for those 65 and older has dropped.
- Debt amongst Boomers has increased and averages $120,000 for those with some kind of debt.
- According to a study in 2014, 30% of Boomers with debt had nothing saved for retirement.
- By the 2030s, 1 in 5 adult Americans will be at least 65 years old. This will continue to put pressure on Social Security and healthcare systems.
- 30% of those younger than the Boomer generation say that Boomers not retiring has impeded moving up in their careers because they aren’t retiring.
- The total number of Medicare recipients who are also receiving Medicaid has increased from just under 9 million to 12.2 million since 2006. Interestingly, as a percentage of all those enrolled it has stayed the same of right under 20%.
- Not surprisingly, those with higher incomes are more optimistic about retirement. 49% of those making less than $50,000 annually are hopeful about retirement. Of those making above $100,000, 69% are hopeful.
- Americans with lower earnings are more likely to have health issues which prevent them from working longer, thereby saving more for retirement.
- Millennials as a group are saving less than previous generations. There is a group of “super-savers” among Millennials, but most have not started saving for retirement. And I don’t think this is due to them buying avocado toast.
I don’t have a lot to add after reviewing this data as it is information I’ve been seeing for some time. Although it may jam up some younger generations (of which I’m a part of), I’m a proponent of working longer into the retirement age, assuming you have that choice. Also, it reminds me to hammer away on my kids about starting to save early.