Perhaps financial goals such as building an emergency fund, paying off debt, or saving to purchase a home are your priorities right now. While these are important goals to work towards, don’t lose sight of the need to save for retirement.
Consider these retirement numbers published by Statistic Brain.
|Average retirement age||62|
|Average length of retirement||18 years|
|Average savings of a 50 year old||$43,797|
|Total cost for a couple over 65 to pay for medical treatment over a 20 year span||$215,000|
|Percentage of people ages 30-54 who believe they will not have enough money put away for retirement||80%|
|Percentage of Americans over 65 who rely completely on Social Security||35%|
|Percentage of Americans who don’t save anything for retirement||36%|
|Total Number of Americans who turn 65 per day||6,000|
|Percentage of population that is 65 years of age or older||13%|
According to this table, the average savings of a 50-year-old is almost $44,000. Let’s assume that this amount was saved over 20 years, giving us a savings rate of $2,200 a year. At that rate, a couple will have $154,000 saved by the time they reach 65. Yet the cost for a couple’s medical expenses alone is $215,000 over 20 years.
Of course, these numbers are for the “average” person/couple. But consider your current retirement savings plan. Or, what if you haven’t started saving for retirement yet? Will you be able to cover medical costs during retirement if they are that high? What about all of your other costs during retirement?
The uncertainty of retirement makes planning for it difficult. However, don’t let that keep you from saving for it. In fact, the uncertainty of retirement is all the more reason to save. So save as early and as much as possible. As your retirement needs become clearer, you can adjust your savings plan accordingly.
For an idea of how much money you might need for retirement, check out Statistic Brain’s savings chart below. To see the rest of their stats on retirement, visit their retirement statistics page.
|Amount Needed in Savings For Retirement|
Monthly income need
Savings Needed for 20 Years
Savings Needed for 30 Years
|The above sums assume your portfolio will earn a 6 percent annualized return during the course of your retirement and endure 2 percent annual inflation erosion.|