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Many Americans are eager to retire. Yet a major concern looms over their golden years – whether or not they will have financial security.
According to a recent survey by Natixis Investment Managers, the average age at which Americans say they want to retire is 62.
However, the expected retirement age varies from generation to generation.
The youngest group, millennials, currently in the 25-40 age group, expect to retire at 59 on average. For Gen X, now aged 41 to 56, the average age is 60. Meanwhile, baby boomers, currently aged 57 to 75, have indicated that they plan to work longer, with an average retirement age of 68.
For example, 83% of non-retired U.S. investors said they thought they would be financially secure in retirement. This includes 88% of Generation Y, 82% of Generation X and 79% of Baby Boomers.
Yet 41% of respondents said financial security in retirement “is going to be a miracle,” the poll found. Sentiment was highest among millennials at 46% and gen X at 45% while baby boomers came in with 30%.
Dave Goodsell, executive director of the Natixis Center for Investor Insight, said that while there is a general sense of confidence, the results show that people have many questions regarding retirement planning.
These questions include: When will I retire? How much money do i need? How long will the money have to last?
“There are a lot of things that make people suspicious,” Goodsell said.
The survey covered 750 American investors who held an average of $ 450,000 in investable assets.
The US results are part of a global survey of 8,550 individual investors. Notably, the median retirement age for this large group globally was also 62.
Goodsell said the U.S. results show that the longer the retirement age for seniors, the more elusive it is.
For baby boomers, the number 68 may also be motivated by a significant threshold for Social Security, he said.
The age of 62 is the year in which people first become eligible for social security benefits. However, by claiming early, they will receive permanently reduced monthly benefits. If they waited until full retirement age instead – until age 67, depending on time of birth – they would get 100% of the benefits they earned.
Research from the Center for Retirement Research at Boston College shows that Americans claim most retirement benefits at around age 62 or at full retirement age as defined by Social Security.
Delaying retirement beyond age 62 not only has advantages over deferring Social Security benefits. This allows someone to wait until Medicare eligibility age – typically 65 – and earn income.
Yet not everyone has a choice of when to retire, Goodsell said, which can come about unexpectedly due to unforeseen health or career circumstances like a layoff at the end of the day. careers.
What can be prepared for all situations is key.
“A lot can be done to educate individuals on their investment options, how to plan for retirement and how to put the pieces together,” he said.