Around half of Americans should be prepared to work until they are 70 years old, according to BankRate’s article “Are you ready to work to 70?” Jennie L. Phipps says that Boston College’s Center for Retirement Research determined this age by calculating the retirement readiness of Americans. Not too long ago, people planned to retire at 65, 62, or even 60 years of age. Anyone retiring before 60 was lucky to have earned a great pension or accumulated a lot of savings that they could use for a 401k annuity to last their lifetime.
The Center found that 30% of American households have saved enough money with which to retire at age 62. Four years later, at age 66, around 55% of Americans are financially ready for retirement. This means that close to half of us are not financially sound enough to retire at age 66. Some of the reasons for this happening are that people are living longer lives that they need to finance, Social Security is not replacing as much a percentage of income, and low interest rates make it harder to earn money on your savings.
Due to the difficult economic conditions that we have all lived over the past decade or so, most of us understand that we’ll have to work longer and are okay with that. It’s nice to know an end point though and the Center for Retirement Research says that 70 is the magical age for many Americans. If you work until you are 70, your Social Security benefits will rise significantly, you don’t have to depend upon your savings for as long of a time frame, and you will collect more money in your 401k account. You can use some of those savings to compare annuities and find one that will finance your entire retirement. Maybe working longer won’t be too bad.
Written by Rachel Summit
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