Americans are living longer, but many fear they will not have enough money to support their ideal retirement lifestyle. A recent survey by an investment banking firm found that 41 percent of U.S. adults aged 50 and older said they won’t be able to live out their envisioned retirement. The number of Americans working past 65 has nearly doubled in the past 35 years.
Data shows that employed individuals over 65 increased by 35 percent between 2015 and 2025. Several factors make saving for retirement more challenging today, including rising costs of living, increased life expectancy, and the shift from stable pensions to less reliable 401(k) plans. Once one gets to retirement age and hasn’t accumulated enough retirement savings, one only has two options left—continue working or accept a lower standard of living in retirement—and neither of them are good,” said Robert Johnson, chairman and CEO at Economic Index Associates.
Over half of pre-retirees, primarily Gen Xers, are considering taking up a side gig to bridge the financial gap in retirement. While 92 percent of retired Americans report not having a side gig, 60 percent say they wish they did. Those who have taken on part-time work in retirement report positive experiences, with 93 percent enjoying the work and many pursuing it for mental or social engagement.
Life after 65 requires vigilance
However, setting up a side hustle is not without its hurdles. “America is a land of opportunity.
Unlike past generations, people today have the ability to learn virtually anything online, build side hustles, and create their own careers,” said Zack Swad, president and wealth manager at Swad Wealth Management. “But with that opportunity comes responsibility and often a lack of structure. Without employer pensions or consistent guidance, more of the retirement burden falls squarely on individuals.”
Health can also impact the pursuit of new income avenues in later life.
Gen Xers anticipate having just shy of $603,000 in retirement savings when they stop working, but they believe they’ll need over $1 million to fund an ideal retirement. Only 14 percent of Gen Xers felt that they had saved enough to live on in their later years. The biggest challenge facing today’s pre-retirees is financial uncertainty—rising health care costs, inflation, and longer life expectancies have made it harder than ever to retire comfortably,” said Brian Harrison, financial planner and president of SAVVI Financial.
Many individuals haven’t saved enough, and even those who have are struggling to manage their retirement funds efficiently.
As Americans grapple with the reality of financing their post-working life, many are turning to side hustles or part-time work to bridge the gap between their savings and their ideal retirement lifestyle. However, with increased responsibility and potential health challenges, the path to a comfortable retirement is not without its obstacles.
Image Credits: Photo by Lukas on Pexels
