The pattern has been the same for the past several generations here in the U.S. After high school and maybe college you embark on your work life. You spend four decades or so in various jobs. Then at some point you have enough resources to retire. Stopping your regular job and enjoying a new lifestyle with fewer demands, less stress, and more time to do what you love. That might have been our typical conception, but these days – in the minds of as many as one in four American workers – that final step, retirement, will probably never happen.
No Plan to Retire?
At least that’s the conclusion from a study that was just released by AP-NORC, a collaborative partnership between the Associated Press and the National Opinion Research Center at the University of Chicago. Researchers at the AP-NORC center surveyed over 1,400 adults nationwide about their retirement plans. What they found confirms that the dream of a secure retirement is “elusive for many in the U.S.,” according to study author Andrew Soergel. Almost half of respondents consider themselves financially unprepared for retirement, and nearly one in four claim they will never retire at all. As the study concludes, a few of these could be motivated by their love of work, but the majority simply consider retirement unaffordable.
As we read stories like this, we’re reminded once again of the absolute necessity for people to plan properly for retirement. How many of those who say they are unprepared to retire have done any actual planning at all?
Andrew Soergel’s article on the AP-NORC study says that the data about never retiring “suggests a disconnection between individuals’ retirement plans and the realities of aging in the workforce.” In other words, those workers who expect to stay on the job indefinitely are in for a rude awakening. “Experts say illness, injury, layoffs and caregiving responsibilities often force older workers to leave their jobs sooner than they’d like.” Other studies suggest that once older workers lose their jobs, they have a much harder time finding a new one, and often never manage to get back to the earning level they had enjoyed previously.
The biggest reason so many people never expect to retire comes down to one factor: they consider themselves financially unprepared. “For many, money has a lot to do with the decision to keep working,” says Soergel. As one expert from the Center for Retirement Research at Boston College told him, “People have to live in retirement much longer, and they may not have enough assets to support themselves.” That’s why AP-NORC shows that fewer than 30 percent of respondents over 50 consider themselves “extremely prepared” or “very prepared” financially for retirement – leaving seven out of ten describing themselves as either somewhat ready to retire or not ready at all. Among current retirees, the numbers are slightly better but not great: roughly 60 percent said they felt somewhat or not at all prepared for the fiscal realities of life once the paychecks stop coming.
The bottom line from the AP-NORC study, in our view, is that planning is the key, because let’s face it, a plan of “working forever” as a solution is unrealistic.
At Tacoma Elder Care we help you think about all the critical aspects of solid retirement planning – finances, housing, medical coverage, legal protection and family communications.
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