Retirement Living: Debt holds many Boomers back

Posted on February 9, 2013 at 5:40 pm

With the average Baby Boomer a half-million dollars short on retirement savings, the prospects for actually retiring look slim. So what do we do about it?

(USA Today) Baby Boomers, forget about retirement. We’ll be working for the rest of our lives.

OK, that may be an exaggeration, but not by much.

We have not saved enough money. And worse, many of us will still be up to our eyeballs in debt when we do retire. We’re just one medical emergency away from bankruptcy.

According to Boomers and Retirement, a new survey by TD Ameritrade, the average Baby Boomer is about a half-million dollars short on retirement savings.

And 74% of Boomers in the survey say they will have to rely heavily on Social Security in retirement. (The average Social Security check, by the way, is $1,230 a month.)

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USA TODAY reported just last week that more people are delaying retirement and continuing to work past 65 mostly because they need the money. According to 2010 Census data, the share of workers 65 and older in the labor force rose to 16%, up from 12% in 1990.

“We will have to work a lot longer and get by with less,” says Olivia Mitchell, professor of economics and executive director of Pension Research Council at Wharton School of Business.

“It’s just getting a lot more expensive to be old than it used to be,” she says.

The National Foundation for Credit Counseling (NFCC), which helps people who are having trouble paying their bills, says one-third of its 3 million clients nationwide last year were 55 or older, up 7 percentage points in two years. Nearly 15% are over 65. That’s scary.

“That is a point in life when most folks thought debt would be the last thing on their minds,” says Gail Cunningham, NFCC vice president.

Even more troubling: Nearly a third of the NFCC clients who file for bankruptcy are 50 and older. “In their golden years they are filing for bankruptcy,” Cunningham says. “That is very disturbing.”  CONTINUE READING

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  1. Comment by Laura B on March 28, 2013 at 5:02 pm

    I applaud the younger people on this website who are starting to assess their situation and their savings. Whatever your age: START SAVING for retirement. If you’ve already started: SAVE MORE for retirement. Starting when you are young is the best thing you can do to ensure you’ll be financially stable when you are old. Don’t worry about all the things you can’t control — taxes, markets, government. Worry about the one thing you can control, which is your own savings. You’ll thank yourself when you are 55 or 60. DO IT, don’t question it, don’t delay, and don’t let anyone talk you out of it. You’ll be glad you did. And, if you are saving now, talk to your friends and get them to save with you.

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