We've heard all the complaints about Boomers refusing to leave the workforce, teasing their Millennial kids about avocado toast, griping about... well, everything. Deserved or not, there is some not-so-good news on the horizon for those aged 59 and older. They'll probably be sponging off you for money, because they're broke.
Okay, maybe not broke broke, but according to the U.S. Census Bureau, more than two-fifths of them have no money saved for retirement. None. Start preparing the spare bedroom now (that is, if you're not living with them, since it's not looking a lot better for younger folk, either).
@kriskrohn The average American is completely unprepared for retirement #retirementplanning #financialfreedom #retirementsavings ♬ original sound - Kris Krohn
While Gen X is slightly behind Boomers with 56.1% having retirement accounts and Millennials just under half with 49.5%, Gen Z has a paltry 7.7% preparing for retirement — but that group also has the most time to save up. And they aren't that different from Millennials, only 17.7% of which had a retirement account at the same age.
As you might have guessed, anyone looking to Social Security to cover their bills will probably have some sticker shock. Benefits for a low earner (making 45% of the average wage) retiring at age 65 in 2023 will be $14,824 a year, about half of their prior income. But benefits for a high earner (with 160% of the average wage) will be $32,345, covering about 30% of their previous wages. That's not awful until you think about getting by on half or less than half of what you're getting now if you're near retirement age.
And if you're close to retirement age, just having a savings account won't cut it. According to asset management company Schroders, you'll want about $1.1 million (yes, that's million) squirreled away to retire comfortably. And what do most people have? The median savings for Boomers is $134,000. So, you know, not ready to retire, at least not in luxury or even comfort.
While the Economic Well-Being of U.S. Households find that most retirees feel they're doing okay financially (92% if they're not single or disabled. though those groups are still above 50%), the future doesn't bode all that well.
In short, be prepared for the Boomers in your life to stop sniping about your avocado toast and to start asking you for loans.