While the Republicans in Congress discuss raising the retirement age and the debate continues the future of Social Securitya new report finds that half of American adults aged 61 to 65 have already retired.
The Alliance for Lifetime Income report also shows that 28% of those same retirees are still providing financial support for grown children and extended family members.
The study, conducted by Artemis Strategy Group from February 15, 2024 to March 2, 2024, surveyed 2,516 consumers ages 45 to 75, of which 505 were a supersample of “Peak 65” consumers ages 61 to 65.
Fifty-one percent of those Peak 65 respondents are already retired, stopping work at an average age of 57.7, according to the report. According to one ALI Study 2020, 25% of adults in that age group stopped working because of health concerns or dissatisfaction with their employer. Twenty-two percent said they were either forced or encouraged to retire.
“Data consistently shows that Americans are retiring earlier than expected due to unforeseen circumstances,” ALI CEO Jean Statler said in a statement. “It's more important than ever that people expect the unexpected when planning for retirement.”
The study also found that respondents feel a wide range of emotions about retirement and money. About a third (34%) are worried about their financial situation, while 33 percent say they are confident. Also, 39% are unsure about their finances, while 42% are optimistic.
Of those surveyed, 51% have investable household assets of less than $100,000, 25% have assets between $100,000 and $500,000, 13% have assets between $500,000 and $1 million, and 11% of Peak 65 consumers have assets of $1 million dollars or more.
Statler said those who have saved $100,000 or less will almost certainly run out of money in retirement, relying solely on Social Security.
“The problem is that people don't realize that Social Security only covers about 40% of your pre-retirement income, leaving a huge gap,” Statler said. The good news is that millions of Peak 65 customers still have the option to protect themselves from outliving their savings. That's why educating consumers about how to have a secure retirement is so important.”
However, 49% of Peak 65 respondents said they are already claiming Social Security, with two-thirds (66%) of them with investable household assets under $100,000.
The survey revealed:
- 43% do so because of disability or incapacity for work;
- 40% need money; AND
- 30% expressed “fear of missing out,” worried that Social Security won't be there in the future, their payout will be cut, or that they might die before reaching full retirement age.
“There is real concern that Social Security will not be able to support the people who rely on it as their primary source of retirement income, so Congress must act now,” said Jason Fichtner, executive director of the Income Institute. Alliance pension. , and a former associate commissioner of the Social Security Administration.
This report confirms the findings of a April 2024 study which found that two-thirds of Peak 65 baby boomers will struggle to maintain their lifestyle in retirement and are likely to live to 20 or more years.