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The Current State of Retirement

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Friday, February 14, 2020

There is a sea change happening in how the American population is retiring. It’s shifted from most retiring in their sixties to a different trend of working as long as possible. There are several reasons for this fundamental change in the way society now sees this demographic.

People, who in the past would have been considered senior citizens, who were past the age of being able to be productive in the workforce, are now relied upon to run things. As we head into 2020, Americans are living longer than ever before and remaining in the workforce for more years than previous generations.

20 percent of people older than 65 in the United States now keep working rather than retire. That’s almost twice the number of senior citizens that were working in 1985. Since 1900, the average age of retirement for working men had declined steadily until the mid-1980s. Since 1985, the retirement age has steadily increased.

Today, 31 percent of Americans are either already working through their retirement or are planning to have a job in retirement. 60 percent of folks that decide not to retire at the regular retirement age are doing so to increase their savings in anticipation of a longer life.

It seems that as we get older and life expectancy increases, we're forced to extend work years. Being prepared for your retirement means you have to budget for the remaining years ahead. If you are retired, you are by definition no longer employed, and that means you are not bringing in an income of any sort other than investments and benefits.

If you are now expecting to live longer than any previous generation you will have to save enough or set aside and invest enough to take care of any expenses for the rest of your life. It is no wonder that older folks are refusing to leave the workforce.

Experts say that we are living longer and are healthier than we have ever been. A person in their 60’s in 2019 has a far better quality of life than someone at that age in America 50 years ago. It’s not some big mystery as to why this is, after all, the technological advancements we’ve seen over the past half-century have spanned all industries, especially the medical field — think about the shift toward preventative medicine and the focus on wellness as opposed to corrective medicine.

Millennials are going to have to plan to live even longer. While many of the newer generations may want to retire early, studies have found that Millennials will probably have to work until they are 70 to save enough to retire in the future.



Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities.

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. 

Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable-- we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances. Member FINRA & SIPC

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Founded in 1976, David Lerner Associates is a privately-held broker/dealer with headquarters in Syosset, New York and branch offices in Westport, CT; Boca Raton, FL; Lawrenceville, NJ; and White Plains, NY. For more information contact David Lerner Associates Call 800-367-3000 Visit our website: www.davidlerner.com

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