Senior Citizens’ Incomes Insufficient In 49 Of 50 States

CHICAGO, Oct. 9, 2014 /PRNewswire/ -- Senior citizens in 49 of 50 states aren't replacing enough of their pre-retirement income, according to a new Interest.com study. Many financial experts say retirees need at least 70% of the income they earned in their working years, but only seniors in Washington, D.C. and Nevada are meeting that threshold. Massachusetts' seniors face the largest income gap for the second year in a row; they bring in just under half as much money as Massachusetts residents between 45 and 64 years old.

"Many Americans are struggling to make ends meet in their golden years," said Mike Sante, managing editor of Interest.com. "Especially in high-cost areas such as the Northeast, retirees are not only competing against the higher incomes of their younger counterparts, but they are also battling higher costs for housing, gas, food and other necessities."

Interest.com examined the U.S. Census Bureau's 2013 "American Community Survey" (the most recent edition). For each state and Washington, D.C., Interest.com divided the median annual household income for those who are 65 and older by the median annual household income for those between 45 and 64 years old. Washington, D.C. (74%) and Nevada (71%) were the only places to exceed the coveted 70% threshold.

"The D.C. area's retirees do particularly well for themselves," said Sante. "This is likely due to the fact that the D.C. area has a large number of retired federal employees, many of whom are able to reap the benefits of pension plans."

People age 65 and older are able to replace at least 60% of their younger counterparts' annual incomes in 28 states and Washington, D.C.Hawaii (69%), Arizona (68%) and Mississippi (68%) join D.C. and Nevada in the top five.

In the two lowest-ranking states, Massachusetts and North Dakota, people age 65 and older are unable to replace even half of their younger counterparts' incomes.

Nationally, the median income for those who are 65 and older equals just 60% of the median income for 45 to 64 year-olds.

For the complete rankings of all 50 states and Washington, D.C., click here:

http://www.interest.com/retirement-planning/news/retirement-income-ample-in-one-state/

The Census Bureau broadly defines income to include wages, salaries, tips, social security, welfare, interest, dividends, pensions, income from defined contribution retirement plans (such as 401(k)s and IRAs), rental properties, royalties and other sources.

About Interest.com:

Since it was created in 1994, Interest.com has been helping consumers make smart financial decisions. Interest.com's stories, calculators and interest rate tables also appear on the websites of more than 100 newspapers in 31 states, including the Los Angeles Times, the Chicago Tribune and the Dallas Morning News.

Interest.com is owned by Bankrate, Inc., which is among the largest and most trusted providers of personal finance advice and information on the Web.

For more information:

Caroline Farhat Publicist
caroline.farhat@bankrate.com
(917) 368-8638

SOURCE Interest.com