When Do You Think You Will Retire, If Ever?

New Study Shows Half of Older Workers Won't Retire Until 70 or Later

When Do You Think You Will Retire, If Ever?
April 27, 2017

Everybody has his or her own view of retirement. Does yours involve working beyond a typical retirement age, or even failing to retire at all? A new survey from CareerBuilder shows that a substantial number of Americans are expecting something other than a traditional retirement.

The survey found that 30% of workers at or beyond age 60 plan to delay retirement until at least age 70. Astonishingly, 20% do not expect to ever be able to retire! While some workers simply enjoy their jobs and/or the camaraderie of a workplace, financial concerns are often the reason for a delayed retirement. As you approach the end of your working years, it becomes clearer whether you are falling short of your retirement goals and need to make financial adjustments.

However, many workers may not have a clear idea of what their retirement goals are, or how much money they will need to have salted away to meet those goals. A typical rule of thumb is to count on needing 70-80% of your pre-retirement income level to maintain your lifestyle, but that assumes good health and relatively good luck. A Fidelity study from 2016 concluded that the average couple retiring at age 65 will spend $260,000 on out-of-pocket healthcare costs over the course of the next twenty years, and that does not include any long-term health care costs.

Contrast that figure with the CareerBuilder survey, which reported that 24% of workers believe that they will need less than $500,000 to retire. Another 25% of survey respondents expected to need between $500,000 and $1 million in retirement funds, and 34% don't know how much they will need to save. If the Fidelity study is correct, these retirees have a good chance of spending from one-quarter to one-half of their retirement funds on uncovered medical expenses. Perhaps that's why delayed retirement expectations are on the increase.

Another factor may be insufficient planning and saving, even as retirement approaches. The CareerBuilder survey found that 26 percent of workers aged 55 or greater do not contribute to any kind of retirement plan. Even with the extra $1,000 in IRA "catch-up" contributions allowed for being over the age of 50, these workers are starting far too late to accumulate a proper nest egg.

Other workers are addressing the shortfall from the income side. Almost three-quarters (74%) of workers aged 55 or greater do not make their desired salary (but really, how many of us do?). A second job was the answer for 8% of these older workers, while another 12% plan to change jobs in the coming year. Neither one of those outcomes are trivial at age 55 and above. Employers may be reluctant to hire you as an older worker unless you bring extensive relevant experience to the table — or you convince them that you plan to be around beyond the traditional retirement point.

Older workers have limited options to deal with a retirement shortfall, and may have to scale back their plans when funds fall short. If you are still young enough that retirement is a far-away concept, we suggest that you take the advice of April Lewis-Parks, the Director of Education and Public Relations for Consolidated Credit, who suggests, "start a retirement fund as soon as possible."

By starting a retirement fund early, you can reap the benefits of compound interest and establish a savings habit early in life. You may still decide to work beyond typical retirement age — but if you do, you can do so on your own terms.

Let the free MoneyTips Retirement Planner help you calculate when you can retire without jeopardizing your lifestyle.

Photo ©iStockphoto.com/Wavebreakmedia

  Conversation   |   7 Comments

Add a Comment

By submitting you agree to our Terms of Service
Chrisitna | 04.27.17 @ 15:38
At this rate, never. I don't foresee being able to retire.
Nancy B | 04.27.17 @ 15:43
It's sad that uncovered medical concerns need to play such a huge part in retirement plans. Retirement is something that we should be able to look forward to, not lose sleep over.
Erin | 04.27.17 @ 15:49
Retirement comes up faster than a lot of people expect, I think. There are so many factors that affect how much you are able to put away for retirement that it is probably hard for the average person to be absolutely certain he or she will have the funds they want when the time comes.
Carla | 04.27.17 @ 16:18
I have hopes that our retirement will come before the age of 70 but my husband thinks otherwise. It is closing fast and my advise to the younger generation would be to put back as much as you can and then add a bit more!
Zanna | 04.27.17 @ 16:34
I am hoping to be able to at least travel on business with my husband when he goes, but I don't think he'll ever retire - he thinks working is more fun! Looking at these projected costs, that is probably a good thing, we're not in a position to retire yet!
Chettie | 04.28.17 @ 13:16
Already retired
Jane | 04.29.17 @ 15:04
It used to be people worked at the same place for 30-40 years, and retired on a pension. That's not the case for most people now. Saving money for retirement is practically impossible for today's youth, who may have high student loan payments, auto payments, maybe a mortgage.
$commenter.renderDisplayableName() | 11.25.20 @ 13:24