Many of Us Won't Be able to Retire Until Our 80s

[Ally]

This is totally depressing reading. Thank God for my husband having a govt. pension (Joint and survivor), plus we both will have SS and savings. Without the pension, it would be much harder. I'm going to thank him tonight for all the crap he has put up with at work to make that possible.

[Running_Man]

I do not believe the assumption of the article that large percentage of Americans will be unable to retire.

It states few can afford retirement at 65 while at the same time stating only 17.2% of people over 65 are working. Of that number a great number would continue working no matter what as they hate the thought of not working. Most people fit their lifestyle into their income available once full age social security becomes available. As long as Social Security pays at today's level people will continue to retire and live on the money they have available to them.

[East Texas]

Quote:

Originally Posted by Worker Bee While then article encourages us to feel bad for those that can't retire, it does reinforce the mathematical fact that Living Above Your Means= No Retirement.

I don't will never understand why most people do not realize living below their means is as simple as consistently spending less than you bring home. The rest of the money goes towards an emergency fund, paying off debt, and retirement.

I specifically did not say "less than you make" because there are tons of fools out there who spend less than their gross; but, more than their net. In their minds, they're "spending less...."

[GregLee]

The article contends that working an extra 3 years at the end -- retiring at 68 rather than 65 -- tends to make a surprisingly large increase in retirement income. That's the way it worked for my wife and me (both retired at 68), partly because we both have state DB pensions calculated using a "high 3" rule, so that our pay raises from ages 65-68 strongly influenced our pension amounts.

[W2R]

I suspect that the author of the article is going by old fashioned, "pension era" assumptions. For example, an old "pension era" rule of thumb was that a retiree needs 80% of their working salary.

Many (most?) new retirees these days without a pension do not expect to spend 80% of their annual working salary each year in retirement - - they were already spending a lot less than that even while working, because they had to save more money for retirement either by maxing out the 401K or saving in taxable investment accounts or both.

A pension is part of the compensation package, and a salary with a pension is effectively larger than the same salary without one, as I see it. This is because the need to save for retirement is lessened if one can expect a pension.

[donheff]

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Originally Posted by BigNick This seems to be a usage of the phrase "want to leave" with which I was heretofore unfamiliar.

+1.

[sheehs1]

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Originally Posted by haha This article is just one more piece of stupidity feeding the endless desire for Americans to be told what's up. No sane employer would employ 75 year olds in preference to 25 year olds. Therefore, for this to happen it must be made impossible to fire an older person. Therefore yonger people will not find jobs, will not be able to set up households, get married, have children or to grow up in any normal way. Now will they just meekly go along, or will they do what frustrated youth have always done and seek a political solution? I know which path I would have taken, and I feel confident that the young people of today and tomorrow are no more passive victims than we were. Ha

Agree with this Ha. It's as if they think jobs for this age group will be available to the majority this age without "taking away" from the generations behind us or as if we have "an option" or as if "it is within our control". I don't think so either.
REal estate future might be in order here. Maybe in 5 plus years there will actually be a real housing industry again ...but even that is questionable.

[52andout]

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Originally Posted by GaryInCO DW and I are parting very amicably. (In fact we're still living together, and probably will for a while, for several reasons.) We haven't finalized the legalities but our current working plan is that we've split all our liquid assets 50/50. There will be no alimony because she generally made more than I did. We have our house (paid off) and two rental houses (one paid off). At first she insisted rentals were all hers (long story, connected to her making more $$) but she has since given up on that stance and we'll be splitting the houses 50/50 too. We'll also split child expenses equally. We've already started telling the boys they don't get a free ride in college from us, but I expect we'll help them some. I have no pension or health care except eventually SS/Medicare. My IRAs and my half of the real estate puts me up around $600k, but I have to live in some of that real estate. I expect to eventually inherit about $200-300k from my mother, which will definitely help. So I think I'll be OK once the boys are out of college, but that's 8-10 years away. Maybe I shouldn't hang out around here. I was resigned to w*rking another 10 years, but after reading some of the stories here I'm getting less and less happy with the idea...

Actually hanging around here might be the best thing for you. Maybe you need to change some of your options, why do you have to live in that real estate? are there cheaper options for you? Maybe when the dust settles you can figure out what your expenses will be going forward and figure out where you can make some cuts to make it workable. One really cheap person can live on way less than a couple with two kids. I am sure some of them will chime in.

[Dreamer]

My DS is in the category that would need to work until age 76. He dropped out of college years ago, is 33 yrs old and earns $10.50 per hour. He is not saving anything that I know of, of course there would not be much to save. You have to live.

I was at Belk's at the mall today and was taken aback at two older ladies who were working there. The one lady looked to be in her late 70's, at least.

[ziggy29]

Quote:

Originally Posted by Ally This is totally depressing reading. Thank God for my husband having a govt. pension (Joint and survivor), plus we both will have SS and savings. Without the pension, it would be much harder.

Wound, meet salt.....

[aaronc879]

Quote:

Originally Posted by Dreamer My DS is in the category that would need to work until age 76. He dropped out of college years ago, is 33 yrs old and earns $10.50 per hour. He is not saving anything that I know of, of course there would not be much to save. You have to live. I was at Belk's at the mall today and was taken aback at two older ladies who were working there. The one lady looked to be in her late 70's, at least.

If he's living on $10.50/hr then he should be able to live on full SS at age 67, shouldn't he? Why continue working longer than that?

[growing_older]

Quote:

There will be no alimony because she generally made more than I did.

I wonder if divorce might be less attractive to her if she didn't think of it as taking all *her* marbles and going home. Instead she might owe you alimony. Or if you end up with primary custody of kids, she could pay child support to you for their benefit.

[jdw_fire]

Quote:

Originally Posted by aaronc879 If he's living on $10.50/hr then he should be able to live on full SS at age 67, shouldn't he? Why continue working longer than that?

$10.50/ hr is $21,840/yr and if that were the average lifetime indexed yearly earnings it would earn $12,201.84/yr in SS. is that what you mean by "full SS"?

[aaronc879]

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Originally Posted by jdw_fire $10.50/ hr is $21,840/yr and if that were the average lifetime indexed yearly earnings it would earn $12,201.84/yr in SS. is that what you mean by "full SS"?

If $12,201.84/yr is what he'd get at full retirement age(currently 67 for him) then yes, that's what I meant. I didn't realize someone working fulltime for the full 35 years(SS takes highest 35 years of income, I think) would get so little. I'm guessing that small of an amount would be untaxed? That along with no other payroll taxes or employer health and it's probably not much less than what he takes home now, although still less. Even with a paid off house, it's hard to get by on $12K/yr. I'm doing it now but barely.

[SandsofTime]

"The only problem is that the latest research shows that you’ll have to work much longer than you anticipated. In fact, many Americans will have to keep on working well into their 70s and 80s to afford retirement"


Umm.... pray do tell, what exactly is the anticipated life expectancy of such workers. Are they planning on retiring when they reach, say the youthful age of 85, or would 90 be the right age to finally "retire".

[SandsofTime]

also, I was quite impressed one "Joe Six Pack" on the marketwatch comment section, who commented thus: "I'm gonna work until I'm 80 and row across the English Channel when I'm 90. After that who knows? Everest? Then with the help of lipitor, viagra, prozac, and the rest of my doc's big pharma kickback recommended drugs, I'll be ready to enjoy full retirement. I can hardly wait"

[Katsmeow]

I was curious and went and found the actual study referenced in the article:

The Impact of Deferring Retirement Age on Retirement Income Adequacy

http://www.ebri.org/pdf/briefspdf/EB...8_Defr-Ret.pdf

I was particularly curious what it would say about how it determined what was retirement income adequacy. Basically it is sufficient income to pay for basic retirement expenses and insured medical costs for the entire retirement period. One thing that greatly increasing the chance of success in retirement (i.e. enough money) is when they don't include nursing home costs. See charts on page 23 of article.

[Katsmeow]

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Originally Posted by Skimmer No sane employer would employ 75 year olds in preference to 25 year olds. Therefore, for this to happen it must be made impossible to fire an older person. I have to disagree. I work at a place where we have people in their 70's, lots of them, and they want to leave, but the company won't lay them off because they don't want to pay them their severance packages. So we lay of the younger folks, who have families to feed and support, and let the old timers sit around and watch TV and play crosswords while collecting full social security and pensions from other jobs. It's disgusting!!

OK I don't get this. First if the people in their 70's want to leave why don't they just leave? Why do they have to wait to be laid off?

Second if the company can't afford to pay severance packages or doesn't want to pay severance packages....then why not get rid of the packages or make them less generous? I mean plenty of places terminate people with 2 weeks notice for example. Is this some requirement of state law where you are?

[kyounge1956]

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Originally Posted by haha Quote: Originally Posted by Skimmer Quote: Originally Posted by haha (snip)No sane employer would employ 75 year olds in preference to 25 year olds. Therefore, for this to happen it must be made impossible to fire an older person. (snip) Ha I have to disagree. I work at a place where we have people in their 70's, lots of them, and they want to leave, but the company won't lay them off because they don't want to pay them their severance packages. (snip) Wow! Can I take it that looking good is not part of the job description around your company? Ha

Ha-ha do you really mean no sane employer would have 75 year old employees because of their looks? Incredible! I thought looking good was only required by the job description for models and movie stars.

[travelover]

One of DW's co-teachers is retiring this year. She is 82.