Plans For Retirement Need Revision For Many Seniors

By: Jody Smith

Many people in their fifties have inadequate retirement savings plans, and some have been making no provision and have no plan whatsoever. A Gallup poll reported that 66 percent of all Americans are worried that they won't be able to afford retirement. According to a Pew Research survey 80 percent of American Baby Boomers are unhappy with the scenario. This information was found in an article on Foxbusiness.com.

Joni Clark, chief investment strategist for Loring Ward, an asset management firm, recommended that Baby Boomers should focus on building their retirement savings, and live frugally when they retire. They would do well to put off retirement as long as possible. When they do retire, they should consider working part-time. It might also be a good idea to delay going for Social Security. If for instance you delay until you are 70 years old, your monthly checks will be bigger. Delaying past the age of 70 doesn't hold any additional benefit. The amount of your Social Security checks won't get any bigger past that point.

According to the fifth annual Retirement Fitness Survey from Wells Fargo and Company, just 23 percent of those between 50 and 59 years of age have stepped up their rate of savings since the previous survey was taken. This group expected to need $800,000 to retire on, but had only saved an average of $300,000 thus far. Not only is the amount being saved for retirement inadequate, but this group also expects to be able to use almost 10 percent of their retirement savings per year. This is despite the fact that the recommendation from financial experts is to only use four percent per year. This was reported in an article on Seniorsdaily.net.

Things have not turned out the way many people expected when they started to save. When they started their retirement savings, it was anticipated that savings would increase on average by 8.7 percent per year. However, the rate of growth per year between 1958 and 2008 has only been 6.6 percent annually.

Inflation has been making the value of retirement savings dwindle, causing a senior's sense of security about the future to dwindle accordingly. All indicators suggest that this state of affairs is going to continue or worsen.  The Risks and Process of Retirement Survey Report, from the Society of Actuaries, reported on the concerns of those facing impending retirement and those who are already retired.

The good news that we're all living longer than past generations did, has an edge to it. The report said that 30 percent of women and almost 20 percent of men who are now 65 years old will probably live to age 90. That's going to take more money than retirees of past generations needed to have tucked away. Seniors facing retirement will need to guard their principal for all their worth.

Jody Smith is a freelance writer for EmpowHER.com.

Sources:

Boomers: Avoid These Retirement Pitfalls

http://www.foxbusiness.com/personal-finance/2011/11/17/attention-boomers-avoid-these-retirement-pitfalls

U.S. workers not saving enough for retirement: Wells Fargo

http://www.seniorsdaily.net/index.php?option=com_content&task=view&id=1652&Itemid=42

Inflation is top retirement financial concern

http://www.seniorsdaily.net/index.php?option=com_content&task=view&id=1293&Itemid=42

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