A recent poll showed that almost one-third of Americans do not think they will ever be able to retire fully.
The 2024 Everyday Wealth in America study, which was made by Greenwald Research for Edelman Financial Engines, shows that more and more workers in the US feel that reaching this traditionally important goal in life is becoming harder and harder to achieve.
About 33% of those who participated said they were not sure if they would ever be able to retire completely, and 6% of the 3,008 people who answered the survey said they thought they would never stop working at all.
This is not the first time that these kinds of worries have been brought up. Retirement used to mean that people could look forward to leaving their jobs at a certain age, but that idea is changing.
Between 2002 and 2007, Gallup polled people and found that 41% of those aged 60 to 64 and 76% of those aged 65 to 69 had retired.
Moving forward to the years 2016–2022, the numbers have changed in a clear way. Only 32% of people aged 60 to 64 and 70% of people aged 65 to 69 were no longer working.
It is in line with what other recent studies have found. What the Pew Research Center found in 2023 was that about 20% of Americans aged 65 and up were still working.
These numbers are much higher now than they were 35 years ago, when they were much smaller. Also, the average age at which people plan to retire has been slowly going up.
People who are not yet retired now think they will retire around age 66. In 1995, the average age of retirement was 60. This is a year older than the official full retirement age for Social Security, which shows how the idea of retirement has changed over time.
The WTW 2024 Global Benefits Attitudes Survey, which came out in the summer, supports this change in expectations. This study found that a lot of older workers no longer see retirement as the end of their careers.
They are choosing a slow shift instead. Sixty-one percent of those who answered had already started making plans for retirement. They said they had cut back on their work hours and taken on fewer tasks at work.
Jim Davis, a senior wealth manager at Aspen Wealth Management, said, “In older generations, retirement was often seen as a clear, final event. People worked until a certain age and then stopped working altogether.”
Today, though, more retirees are choosing a phased method, in which they gradually cut back on their work hours instead of quitting their jobs all at once.
This change is mostly caused by the need to save money, the desire to stay mentally and socially busy for longer, and the fact that people are living longer.
The new retirement mentality
Americans are not only changing when they retire, but also what they want their golden years to be like. The Edelman study found that almost 40% of people want their retirement to be different from how it was for their parents and grandparents.
A big chunk of the people asked wanted to be more active after they retired. Fourteen percent wanted to be more active, thirty nine percent wanted more adventure, and twenty four percent planned to live a more nomadic life.
But worries about personal funds are still very present. 65% of people who answered the Edelman study said they were at least somewhat confident in their ability to save enough money for retirement.
However, 35% said it would be hard to afford the lifestyle they want once they stop working. More and more people do not feel safe with their money because of high inflation and rising living costs.
It is true that not all Americans are ready for retirement. Some people are going through what has been called a “midlife retirement crisis.” This problem was brought to light by research that Prudential Investments did earlier this year.
Their poll of Americans aged 55, 65, and 75 found that a lot of older workers are not at all ready to leave their jobs.
For people aged 55, the typical amount saved for retirement was only $47,950, which is a long way below the eight times one’s annual income goal for that age.
The June study also found that many older Americans are putting off retirement because of the economy.
One-third of 55-year-olds had already put off retirement because of rising costs of living and inflation. In the same way, 43% of people aged 65 had also put off retirement for these same reasons.
Most people aged 55 (48%) planned to work part-time during their retirement years in order to make ends meet. The same was true for 25% of people aged 65 and 13% of people aged 75.
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