Six Things Retirees Can Teach Us About Retirement Preparation

Today’s crop of retirees have a lot of wisdom to pass on to the rest of us.

According to a survey by the Transamerica Center for Retirement Studies, some aspects of the reality of retirement don’t quite match with expectations. If they could go back in time to their youth, knowing what they know now about their retirement years, what would these retirees tell themselves? What would they tell you as you prepare for your own retirement?

Thanks to Transamerica’s researchers, we now have a pretty good idea.

1. Retirement may come early

First, don’t count on being able to retire on your planned timeline. The strong majority of those current retirees surveyed reported that they retired sooner than expected — and only 16% said they had saved enough by that time.

For example, most retirees reported that they didn’t get to choose the date they left the workforce. Six in 10 reported that retirement came sooner than they had planned. Some were forced into retirement by poor health, the need to care for an ailing family member, layoffs or other structural changes, or just sheer unhappiness with their employment and career situations.

You need to have a backup plan in case any of the above happen to you.  

2. Save more

Almost half of retirees (47%) reported that they hadn’t saved enough while they were working. Most respondents (69%) cited Social Security as their primary source of income.

Just 18% cited retirement accounts and personal savings, including a 401(k) or similar accounts/IRAs (7%), and other savings and investments (11%) as their primary income source. One in 10 retirees reported a company-funded pension plan as their primary source.

Furthermore, only 16% of retirees reported that they had built enough savings to have a secure and successful retirement, and 76% wished they had saved more on a consistent basis.

3. Get professional advice

About half of the survey respondents — 53% — would have liked to have received more information and advice from their employers, while 68% wished they had known more about investing and retirement saving.

Getting professional advice is especially important because beginning at about age 55 and lasting through your 70s, when you will likely have to make a series of important decisions that can have far-reaching consequences.  

4. Plan on being retired for decades

On average, retirees reported themselves to be in good health, expecting to live a median average of 28 years into retirement.

Four in 10 expected to live for another 30 years or longer. Many of them were planning to live to 90. Plan accordingly.

Many people who live long run into an issue of dwindling cash in their retirement accounts, forcing them to make difficult decisions later in life, when they will likely need their funds more than ever before.

6. Start planning now

Nearly half of respondents reported wishing they had started thinking about retirement earlier. Nobody said they were glad they hadn’t considered retirement until the last minute.

We can help you put together a sound plan for your retirement. It takes dedication to saving and planning your future carefully. We can help you get there with sound advice with your best interest in mind.

Leave a Reply