Living Longer with Less Pensions and Retirement Plans
We are living longer, staying healthy longer and outlasting what we originally thought would be the end of our lives. More people of retirement age are doing more to stay active, eat well and overall, taking better care of themselves. This leads to a longer than expected life span, more medical expenditures, household expenses and less money to cushion the so-called Golden Years. Inflation plays a huge part in trying to save money for retirement. We are earning less while working more and longer with very few pension plans and weak retirement plans. Very few people can afford to have money taken out of their paychecks and set aside for retirement as the amount they earn covers their daily expenses. So the longer we live and the longer we work the more we will need to cover living costs and the less there will be for retirement.
Incomes Have Been Stagnant
The income ladder for working class people has remained mostly stagnant since 1970 while the ladder to high incomes has risen. Nearly two generations of employers have provided less than adequate retirement plans for their workers or have provided none at all. During the last 6 years, excluding this one, the writer was employed by other companies and a non-profit organization which paid dismally and offered no employer match for any retirement plan offered. Workers tend to use every single cent of their paychecks to make ends meet. There is barely any room to pull money out and have it automatically go into an employer sponsored retirement plan. Incomes must rise to meet the demands of inflation and workers.
Government Cuts in Social Security and Medicare
The very saving system we have all been paying into since we started working may not be there for us when we retire. Social Security is taken when workers retire and can be taken as early as age 62. However, if we work longer we can get more. As more seniors live longer, the more they will draw from this program leaving less for the generations which come after them. This is no one's fault. It is just a fact of life.
What Can We Do to Prepare for a Good Retirement
Despite the bad news about not being prepared for retirement, there are some things we can do now to add a little cushion to a later after-work life.
• Sit down with someone who is financially savvy and work out if there is any way to put even $50.00 into a retirement plan.
• Determine how long you want to work and if you can live off the social security benefit at the age you want to retire, assuming there is enough left in the collective balance to do so.
• Open an Individual Retirement Account (IRA) and contribute to it. The more we save now, the more we will have later.
• Stick to all savings plans.
Of course, if facing foreclosure or eviction, or have a major medical expense, borrow as little as possible from one of the plans. Try not to take any money from a retirement plan if a job loss happens. Every worker has emergencies which come up unexpectedly. Most of them do not have savings to cover them. This is in part, due to a rotten economy, a Congressional body fighting with themselves and ignoring the general public. The bottom line is to take care of yourself and family and work hard to save for a better retirement. Your net worth is up to you.