American workers generally believe they will retire at age 65, the country’s traditional retirement age. But real life often gets in the way of those plans, and new research shows that the majority actually quit their jobs much earlier. And for many, it’s not by choice.
The median retirement age for Americans is actually 62, which means the typical worker is retiring from their career three years earlier than expected, the magazine says. . new research By the Employee Benefits Research Institute, a nonprofit organization focused on employee benefits programs.
The findings highlight the gap between retirement goals and reality. One of his increasingly popular ideas is often promoted by congressmen and congressmen. business leader, that Americans should work longer to better enjoy their golden years.Because millions of workers are in dire conditions. Not enough savings for retirement, working longer is seen as a way to solve the lack of funds. But the reality is that many older Americans are forced into retirement before they are ready.
But even if people want to work longer, it’s not always possible, a new study finds.
“It’s hard to argue that everyone should work longer and that that’s going to solve the problem of retirement,” Craig Copeland, director of wealth benefits research at EBRI, told CBS MoneyWatch. “It’s obviously not going to solve all the problems, because a lot of people can’t do it.”
According to the report, seven out of 10 retirees quit their jobs before the age of 65. Overall, around half of respondents said they quit their job earlier than expected, with the majority citing reasons beyond their control. For example, about one-third cite health problems or disabilities as a reason for leaving their job earlier than expected.
The survey found that only about two in five people said they quit their jobs sooner than expected because they had more time to spare.
In the gap between expectations and reality lies the potential for troubling consequences. For example, a worker who plans to retire at age 65 but was forced to quit his job years ago may not have enough savings.
Many older Americans already lack retirement savings; new AARP research It was found that one in five people over the age of 50 has not saved anything for retirement.
Amount needed: $1.5 million
A new EBRI survey conducted in January of 1,255 workers and 1,266 retirees found that only about half of workers have calculated how much money they will need in retirement. . According to the EBRI survey, about one-third of people who have considered their financial retirement goals think they need at least $1.5 million.
This is consistent with other studies that have revealed what the typical worker believes to be necessary. $1.46 million To retire comfortably. But in reality, most Americans have far less than that, with EBRI noting that about one-third of workers currently have less than $50,000 in savings and investments. There is.
Copeland said Americans may be choosing a higher number because of the rule of thumb that says you should save about 10 times your salary for retirement.
“So if you’re making $100,000 or $150,000, $1.5 million is a simple calculation to get you there,” he pointed out. “They’re realistic about what they need, but I’m not sure they’re realistic about what they need to save to hit that number. That’s the problem.”
At the same time, the EBRI survey found that most workers expect Social Security to provide a source of income in retirement, despite the challenges facing benefit systems. lack of funds In less than 10 years. If Social Security is not strengthened by 2033, retirees could face benefit cuts of more than 20% across the board, a worrying problem for workers with little retirement savings.
Still, today’s retirees are generally optimistic about their lives, with two-thirds saying they are living the retirement life they envisioned, according to the EBRI survey.
“Overall, I’m pretty positive,” Copeland said. “But getting there can be a stressful situation.”
