When it comes to getting by successfully in retirement, turns out it’s not enough to save.
You have to save enough.
According to an article over at Fox Business, a report by the Federal Reserve reveals that many American workers who are going to the trouble of setting aside money toward the day when they eventually cease work altogether…are simply not saving enough to ensure a financially secure retirement.
In fact, it’s not even close.
As the Fed’s survey details, those households able to access retirement accounts have an average of just $110,000 accumulated for retirement. That figure, according to analysts, is only about one-third of the total funds needed to maintain their standard of living, and that includes the money expected to be received from Social Security.
The current, average, monthly benefit derived from Social Security is $1,348, which comes to $16,176 per year.
Moreover, the Federal Reserve’s data indicates that just under one-third of all working Americans have no retirement savings whatsoever, outside of whatever Social Security monies they will see.
At the rate things are going – including the rate at which Americans are not saving for retirement – the United States is on pace to see 25 million of its citizens become poverty stricken when they retire in or around year 2050.
While this space has previously said that the oft-suggested minimum goal of $1 million in savings may not be necessary to help finance a secure retirement, $100,000 won’t cut it, either. As the Fed’s analysis bears out, an absolute minimum target goal should be $300,000 by retirement, and that assumes the retiree will see additional sources of income, like Social Security, as well as, perhaps, modest earnings from an easy-to-manage part-time business or job.
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