FOX11 Investigates finds more than half not saving for retirement
GREEN BAY (WLUK) -- After you finish school and get a job, the expectation is you'll work for 40 years or so and then retire. You know, that's when you live off your life's savings, travel the world, and relax in your golden years.
But it doesn't always work out that way.
“The statistics on the people that haven't saved much of anything for retirement are disheartening,” said Ken Petter, branch manager of Robert W Baird financial advisors in Green Bay.
According to the U.S. Government Accountability Office, 52 percent of those age 55 and older have no retirement savings. Nothing! Of the 48 percent who do have some retirement savings--the median amount is approximately $109,000.
Petter says you need to start saving from your very first paycheck.
“Probably the primary mistake is not starting soon enough. The sooner the better, as much as you can, at least the rule of thumb 10 percent,” said Petter.
If you don't save enough, you could be working longer. A 1983 law has slowly been raising the retirement age before you can collect full social security benefits. That age right now is 66. If you were born in 1960 or later it goes up to 67. New legislation proposed last year would eventually put the retirement age at 70.
And economic experts say don't count on just Social Security.
“It was never designed to be 'this is solely what you live off of.' This is one part of a puzzle that you're putting together to build your retirement,” said Marc Schaffer, assistant professor of economics at Saint Norbert College.
The Social Security Administration tells us Social Security Benefits make up on average only 34 percent of income for retirees. But keep in mind the average monthly benefit paid last year was $1,404 --for a total of $16,848 a year. The question is--if you haven't saved anything for retirement, would you be able to maintain your lifestyle in retirement on just $16,848 a year?
“It's overwhelming to some extent,” said Schaffer.
Randy Harbath retired early at the age of 63 knowing he won't get full social security benefits. His advice 'pay retirement first starting with your first paycheck.
“Get it out of your (paycheck), take a certain amount out every month. Maximize if your company has a 401(k). Maximize any matching funds they have, and then learn to live on what you've got left,” said Harbath.
For those who don't save, living on just Social Security will be difficult. Taxpayers will be forced to pick up added costs. In 2015 Wisconsin spent $1.2-billion on the four main programs assisting seniors. By 2030 it's estimated the cost will be $4.7-billion.
“If you want to be able to afford to maintain your lifestyle you need to have enough assets and it's all savings required,” said Petter.
Watch for more reports on saving for retirement on FOX11 during the month of May.