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Retirement Isn’t Happening for America

What’s the state of American retirement?

Well, several studies and news stories indicate most Americans don’t have enough saved for retirement and aren’t saving enough to catch up. So, they’ll rely on Social Security, which almost assuredly won’t be enough.

Other than that, American retirement looks great!

I hope you sense my sarcasm.

Many people think Social Security will fully provide for them in retirement. Well, the maximum a 65-year-old retiree can receive this year is $2,757 per month. If you delayed Social Security until turning 70, you’d get $3,770 per month in 2019.

But those are the extremes. The average Social Security beneficiary receives $1,413 per month. And that’s the average. Some people receive less than $1,000 a month. And the truth is, neither amount is enough to fund lavish trips and a country club membership.

Of course, Social Security was never designed to be the entire retirement nest egg. It was always meant to supplement personal savings.

Current non-managerial workers take home about $779 per week (or about $40,000 per year), and that’s almost a 40-year high. It’s doubtful a large enough percentage of the average salary is being saved for retirement. Unsurprisingly, income data suggest most Americans can’t afford to live a typical middle-class lifestyle and save enough to finance a 20-year retirement.

On top of that, the fourth quarter of last year hurt many retirement savers (because they’re invested in equities). Look at the drop in average values across the board:

With average balances that low, we’re in trouble. What sort of retirement can the average person look forward to? Can they retire at all? The numbers aren’t encouraging.

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