US Retirement: a Growing Concern

Americans face a worrying financial futureA report by Michael Hiltzik on LAtimes.com raises the worrying concerns facing many of us upon retirement: not having any money left in your final years. In fact it estimates that almost half of all Americans will die with little to no money to their name.

While this is obviously extremely disturbing news, without us addressing the issue as individuals and as a society we are increasing the probability of the forecast becoming reality.

Even those who have followed what were considered adequate guidelines in planning for their financial future and eventual retirement are likely to be affected, due to changing economic and employer pension factors, as well as the fact that we are living increasingly longer lives.

Currently, those over the age of 75 are particularly liable to find themselves facing a financial crisis, and more & more are running up credit card debt in order to get by. Between 2007 and 2010, credit card debt for those 75 and older grew from less than 19% to 21.7%: absolutely every other age group recorded a decline in credit card balances.

So what are we to do? Comparatively recent financial concepts like Advanced Life Deferred Annuity – also know as ALDA – may be one solution. An annuity like ALDA pays only from a pre-determined, older age – 75 or 80 for example – which makes it a more affordable form of coverage that pays in our most vulnerable years.

You can find out more by reading the full article here.

Philip

5 Comments

  1. It’s shameful how the income gap keeps growing. The rich are getting richer as the rest of us struggle to stay afloat and then vote against our own economic self-interests. 🙁

  2. I’m going to have to look at this Advanced Life Deferred Annuity. I set up my own retirement type plan with a lot of dividend yeilding stocks, kind of like the IRA programs that the Fed is trying to push us into now, I just wanted to get a jump on it and have access to my money without penalty in case I needed it early. However, I didn’t realize how much money you’ve got to put in your IRA in order to make a decent living allowance, and it’s pretty scary to think that a medical emergency could come and force you take money out.

  3. this is scary to me. I already sock away 4% of my wage (a huge amount for me) and my company mqtches it. It terrifies me that there might not be social security left when I get to that age. Also running up credit debt will affect my son-when you pass the family is responsible. I also want to leave him some form of legacy.

  4. I think this is also something that has to do with education. Finance education, I mean. I’m almost 40 and I have already begun to think about retirement. I have a savings account set up and I try to do my best to not end up in a bad financial situation 20-30 years from now. However, many of my work colleagues think I’m crazy. They will not even think about saving up for retirement or investing money in something that would make their elderly years easier.

    • I agree with you Mike, I believe it is to do with financial education – or lack of it. It’s such an important issue, I really think it should be a part of the school Curriculum. I have read that schools in the UK have started to teach financial education to the children there, let’s hope the idea spreads.

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