News You Need to Know: Retirement Social Security
New York Times, “Our Ridiculous Approach to Retirement,” 2012-06-21
Seventy-five percent of Americans nearing retirement age in 2010 had less than $30,000 in their retirement accounts. The specter of downward mobility in retirement is a looming reality for both middle- and higher-income workers. Almost half of middle-class workers, 49 percent, will be poor or near poor in retirement, living on a food budget of about $5 a day.
For clients to maintain living standards into old age they will need roughly 20 times their annual income in financial wealth. If they earn $100,000 at retirement, they’ll need about $2 million beyond what they’ll will receive from Social Security. With an income-producing partner and a paid-off house, the need is less. This number is startling in light of the stone-cold fact that most people aged 50 to 64 have nothing or next to nothing in retirement accounts and thus will rely solely on Social Security.