If you’ve ever taken a look at American retirement statistics, you probably left feeling a little glum about the financial future of many people. It’s true, most people nearing retirement age are not prepared for what comes next. With programs like Social Security being pushed to the breaking point, there are many older Americans who are truly entering a time of vulnerability. If you are a younger person and don’t want to find yourself in the same situation a couple of decades down the road, it’s time to get serious about making that happen. No one’s going to do it for you. Fortunately, it isn’t as hard as you might think.

People who have the easiest time of retiring are either 1) very lucky, or 2) make a good plan early in life and don’t deviate from it. Not everyone who retires has to have great earning potential. But retirees in this case do have to acquire a kind of sophistication that is easy to avoid through laziness or lack of attention. Having a good plan for retirement is kind of like having a budget for your entire lifespan. If you follow it to a tee, you’ll be likely to have more than enough to live once you decide you no longer want to work.

The foundation of preparing for retirement is getting your daily finances in order. First, you’ve got to earn enough to make your life worth. Earning income is the engine with which you’ll run the rest of your financial life. Even though you don’t need to have high income to retire well, it sure doesn’t hurt. If you are able to increase your earning potential, do so. It will make everything that is to follow much easier.

Once you have income worked out, saving, investing, and staying out of debt will make future retirement much easier to achieve. These are basic skills, but many people don’t practice them and thus cheat themselves out of the retirement they’d like to plan for themselves. If you don’t understand the basics of living beneath your means, take some time to learn and apply them.

Once you’ve put yourself on the road to wealth generation, through earning, saving, investing, and asset acquisition, it’s time to start to preserve what you have. Life insurance companies offer many packages which will protect your wealth moving forward, no matter what happens to you. Adjusting your portfolio balance to protect against sudden market turmoil. Spreading out money into diverse asset classes is another classic way to protect against uncertainty in one or more areas.

Retiring isn’t going to be easy for young people alive today, but with effort and determination it will be more accessible than many presently think. Just because many people nearing retirement today don’t have the resources saved up to do it, this doesn’t mean that the same fate has to befall the young people of today. As time goes on, this seems to be the goal of more and more young people. Get aboard today!

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In the years between 2030 and 2032, a couple of interesting things are bound to happen. The National Academy of Social Insurance says that, by 2030, the ratio of Social Security beneficiaries to those who are paying into the system will rise to 45 per 100. In 2014, the ratio was 35 per 100. In 2031, the youngest Baby Boomers will turn 67 and reach what is, for now, the retirement age. According to estimates from the Office of Retirement and Disability Policy, 2032 just might be the year when Social Security’s reserves get depleted.

The Baby Boomers, those born between 1946 and 1964, are an easy target for all the voices who say they are breaking Social Security. And while Gen-Xers and Millennials might rightfully wonder what this means for them and their retirements, Baby Boomers are also worried. There’s little time for them to change their financial situation, and from how things look now, they’ll need those Social Security checks.

How Big of a Trouble Are Boomers In?

survey published by PwC found that, in 2017, the percentage of fully employed Baby Boomers who have less than $50,000 in retirement savings was 30%, down from 37% in 2016. 16% have between $50,000 and $100,000 (up from 13%), 26% have between $100,000 and $300,000, and 27% have more than $300,000 saved (up from 24%). And while that survey doesn’t paint a pretty picture, it gets even worse when those who are not full-time employees are included.

According to an online survey performed in 2016 by GOBankingRates, the percentage of those who were older than 55 and had no retirement savings was 28%. 17.3% had less than $10,000, 15.8% had between $10,000 and $100,000, 16.5% had between $100,000 and $300,000. 22.4% had over $300,000 in savings.

If we go by the most optimistic estimates, nearly half of Baby Boomers don’t have nearly enough savings to retire on, even if one thinks that the “80% of pre-retirement income” rule for retirement is overinflated. On top of that, they will have to find a way to deal with increased costs of healthcare. Because they will live longer than previous generations, they’ll have to spread their savings over a longer period of time. And even simple things like eating modest meals add up to a lot over a 20-year period.

What Caused the Baby Boomers’ Problems?

Baby Boomers are very much aware of the trouble they’re in. The Insured Retirement Institute (IRI), which has been publishing their annual Boomer Expectation for Retirement reports since 2011, found in 2017 that 60% of Baby Boomers expect their Social Security checks to be a major source of income. Only 23% believe they will have enough money to last through their whole retirement.

The same report sheds some light on some of the potential reasons why Baby Boomers might be in such dire straits. Only 40% of them have tried to calculate how much they should save for retirement. Out of those who tried, 40% didn’t factor in healthcare costs. 80% of Boomers underestimate the share of their income they’ll have to spend on healthcare.

Bad planning and management are not the only possible reason why the generation is in financial trouble. Baby Boomers were hit by the Internet bubble, the 2008 financial crisis and the recession that followed it, and they are a generation that might be stretched too thin by supporting either their children or their parents. Or both.

The Boomers’ Response

As a response to their situation, 27% of Baby Boomers plan to retire sometime after they turn 70. 21% don’t even know when they’ll retire, and only 20% plants to retire early, before they turn 65. A study by Merrill Lynch showed that many Baby Boomers would be willing to cut back on basic expenses to increase their savings. 75% would be willing to work longer – part-time, if possible. And 91% would follow in the footsteps of Presidents Clinton, Bush, and Obama – Baby Boomers and fitness-enthusiasts-in-office.

Baby Boomers can also downsize their homes to save on costs and to get the benefit of the equity. They also have access to reverse mortgages – nearly two million homeowners qualify in Texas alone for this type of mortgage that lets them use their home without the need to make any payments.

Some of the solutions to Baby Boomers’ problems might affect the younger generations. People deciding to retire later could affect the labor market in a way that will make it harder for those who are just entering it to start creating their own retirement savings due to lower wages. But if nothing else, the Baby Boomers’ predicament serves as a cautionary tale for Gen-Xers, and Millennials especially. The moral of the tale is – learn to manage your finances, save smart, and save early. And don’t forget about healthcare.

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