By Jean Statler
A not-so-funny thing happens to many Americans on the way to retirement — they save and accumulate money for retirement, only to realize that when they do get ready to retire, they’re not sure that their saved money will last.
Unfortunately, many retirement savers have been conditioned to think only about saving a magic lump sum number from which they can start withdrawing money each year after they retire. Little attention is paid to calculating how much actual income they’ll need each month to live on and if that money will last throughout retirement.
The Protected Lifetime Income Index study, a recent survey of 3,119 adults by the Alliance for Lifetime Income, shows that a mere 28% of non-retired Americans have made an effort to determine their likely monthly income needs in retirement —perhaps the single most important thing people should be planning for.
Even among those closest to or in retirement — Americans between 55 and 74 years of age — only 43% have made such a calculation.
If people don’t know what they’ll need, how will they know if they’ve saved enough to last throughout life? It’s no wonder that the survey showed 80% of us are anxious that our savings may not be enough to live on or last through retirement.