Young Research & Publishing Inc.

Investment Research Since 1978

Disclosure

  • About Us
    • Contributors
    • Archives
    • Dick Young’s Safe America
    • The Final Richard C. Young’s Intelligence Report
    • You’ve Read The Last Issue of Intelligence Report, Now What?
    • Dick Young’s Research Key: Anecdotal Evidence Gathering
    • Crisis at Vanguard
  • Investment Analysis
    • Bonds
    • Currencies and Gold
    • Dividend Investing
    • ETFs & Funds
    • Investment Strategy
    • Retirement Investing
    • Stocks
    • The Efficient Frontier
  • Investment Counsel
  • Retirement Compounders®
  • Free Email Signup

Will You Run Out of Money in Retirement?

May 21, 2019 By Jeremy Jones, CFA

By perfectlab @ Shutterstock.com

The Employee Benefit Research Institute has run the numbers, and they don’t look good. An estimated 40.6% of American households are projected to run out of money in retirement. Christy Bieber reports:

Saving too little for retirement is a major fear of most Americans, and studies have shown that more Americans fear insufficient retirement savings than fear death. Running out of money is indeed very frightening, as no one wants to be without the cash they need in their 70s and 80s. But how likely is it that you’ll actually run out of money during your retirement years?

Unfortunately, research from the Employee Benefit Research Institute shows there’s a pretty good chance that many Americans will run short of cash. In fact, the data about retirement savings shortfalls is startling. The good news is, if you know the risk of running out of money, you can take some steps to reduce the chances you’ll become one of the seniors with too little saved to see you through.

How many U.S. households are going to run short of money?

According to the EBRI Retirement Security Projection Model, which was developed in 2003 and has been updated numerous times since, an estimated 40.6% of all U.S. households headed by someone aged 35 to 64 are projected to run short of money during retirement. This is based on a database of 27 million 401(k) participants and IRA account holders. This seems like a whole lot of households are going to run short, but it’s actually a decline of 1.7 percentage points compared with the same model in 2014 — so things are getting a little better.

Sadly, for those families likely to run out of cash, the shortfall isn’t small. Even taking into account Social Security benefits, the aggregate retirement deficit for households headed by someone aged 35 to 64 is $3.83 trillion. Again, this is a slight decline from the $4.44 trillion shortage in 2014, but a shortage in the trillions isn’t good news for anyone.

When looked at on an individual basis, the data becomes even more worrisome. In fact, EBRI projected average retirement savings shortfalls of $12,640 for widowers, $15,782 for widows, $24,905 for single men, and $62,127 for single women. Those who live the longest will also be far worse off, with Americans expected to live the longest facing 10.2 times the retirement deficit compared to retirees with the shortest projected lifespans.

This data should be worrisome to everyone, because even if you’re not one of the four in 10 Americans who will have thousands too little in retirement funds, your friends and neighbors are likely among this cohort — and having millions of broke retirees across the country isn’t exactly good news for the economy.

Read more here.

Share this:

  • Email
  • Twitter
  • Facebook

You Might Also Like:

  • Can Money Buy Happiness?
  • Have You Already Lost Hope for Retirement?
  • Top 10 “Retirement Killers”
  • Author
  • Recent Posts
Jeremy Jones, CFA
Jeremy Jones, CFA, CFP® is the Director of Research at Young Research & Publishing Inc., and the Chief Investment Officer at Richard C. Young & Co., Ltd. CNBC has ranked Richard C. Young & Co., Ltd. as one of the Top 100 Financial Advisors in the nation (2019-2022) Disclosure. Jeremy is also a contributing editor of youngresearch.com.
Latest posts by Jeremy Jones, CFA (see all)
  • Money Market Assets Hit Record High: $5.4 Trillion - May 26, 2023
  • The Mania in AI Stocks Has Arrived - May 25, 2023
  • The Wisdom of Sam Zell - May 24, 2023

Search Young Research

Most Popular

  • Your Survival Guy Felt Like a U.N. Worker in Rome
  • The Mania in AI Stocks Has Arrived
  • Money Market Assets Hit Record High: $5.4 Trillion
  • Your Survival Guy in Rome 30-Years A.B. (After Babson)
  • The Future of the American City is This…
  • Vanguard Wellesley (VWINX) vs. Wellington (VWELX): Which Fund is Best?
  • A Three-Week International Research Trip to Paris via Rome
  • Is an Investment Property Disaster Looming?
  • Letter to the Federal Reserve Chairman from Your Survival Guy
  • The Power of a Compound Interest Table

Don’t Miss

Default Risk Among the Many Concerns with Annuities

Risk and Reward: An Efficient Frontier

How to be a Billionaire: Proven Strategies from the Titans of Wealth

Cryptocosm and Life After Google

Warning: Avoid Mutual Fund Year End Distributions

Is Gold a Good Long-term Investment?

How to Invest in Gold

Vanguard Wellington (VWELX): The Original Balanced Fund

What is the Best Gold ETF for Investing and Trading?

Procter & Gamble (PG) Stock: The Only True Dividend King

The Dividend King of the North

You’ll Love This if You’re Dreaming of an Active Retirement Life

The Importance of a Balanced Portfolio

Invest with Peace of Mind and Comfort

What Kind of Life Are You Investing For?

RSS The Latest at Richardcyoung.com

  • Rewarding Loyalty with Ridicule
  • Rome, Paris, U.S.A.: Global Crisis in Confidence
  • June Is Retirement Compounders Month
  • Americans Scared of CBDC Control of Their Money
  • Your Survival Guy’s Best Insider’s Guide to Rome
  • Auto Profitability Colliding with Low Emissions
  • Birth Rates in France Worst Since Post-WWII Era
  • What Binds the Woke Left Together?
  • Joel Salatin and Alfie Oakes, America’s Food Kings
  • The Party Is Going Off the Rails

RSS The Latest at Yoursurvivalguy.com

  • Rome, Paris, U.S.A.: Global Crisis in Confidence
  • Your Survival Guy’s Best Insider’s Guide to Rome
  • What Is a Fiduciary Duty? Are You Working with a Fiduciary?
  • Survive and Thrive June 2023: Your Survival Guy in Rome 30-Years A.B. (After Babson)
  • Birth Rates in France Worst Since Post-WWII Era
  • Your Survival Guy Felt Like a U.N. Worker in Rome
  • Social Security: Declining Italy Needs a Bambino Boom
  • ATTACK ON THE IVAN KHURS: Unmanned Vessels Changing Naval Warfare
  • The Future of the American City is This…
  • Happy Memorial Day: Your Survival Guy: Proud To Be an American

About Us

  • About Young Research
  • Archives
  • Contributors

Our Partners

  • Richard C. Young & Co.
  • Richardcyoung.com

Copyright © 2023 | Terms & Conditions

 

Loading Comments...
 

    loading Cancel
    Post was not sent - check your email addresses!
    Email check failed, please try again
    Sorry, your blog cannot share posts by email.