These 10 stats could motivate just about anyone to make retirement planning a priority, according to a recent article in ThinkAdvisor. They extracted the 10 statistics from the National Association of Government Defined Contribution Administrators, Inc. (NAGDCA) that they believe rank highest on the list.
The opening sentence in the NAGDCA study is “The unfortunate state of Americans’ financial preparedness for retirement is well-documented, and may be summed in two words: NOT READY.”
Here we go:
- Just 22 percent of workers are very confident they will have enough money in retirement, according to the Employee Benefit Research Institute’s 25th annual “Retirement Confidence Survey.”
- According to recent Congressional testimony, 45 percent of Americans have saved exactly nothing — zero, zip, nada — toward retirement.
- “Not seen since the Great Depression.” According to the report, that’s the magnitude of the financial challenges that will be faced by upcoming retirees — the first generation since that terrible time to do so.
- People are expected to live 20 years beyond age 65. That’s the expected additional lifespan of a woman of 65 — two years longer than a man — but it’s likely to bring her a lot of financial grief.
- Just one in six employers offers health insurance coverage to retirees these days.
- $220,000 is how much the average 65-year-old couple can expect to part with over the next 20 years in out-of-pocket costs for health care, thanks to not having any insurance to pick up the tab.
- 5.8% is the projected annual growth rate for health care spending through 2022.
- The average retiree can expect Medicare to pay only 62% of their health care expenses, once it finally kicks in.
- Another way of looking at #8 is 38% is how much of your medical expenses you’ll have to pay when you file a claim with Medicare.
- You could end up paying $200,000 for a single year in a skilled nursing facility (read “nursing home”) or a high-end assisted living facility (particularly if costs continue to escalate). This underscores considering long-term care insurance as part of your retirement plan.