Numbers To Put Your FIRE Journey In Perspective

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No words of wisdom from the FIRE Station this morning – just some interesting numbers to put your journey to FIRE into some perspective:

AGING

  • 50% of Americans are retired at age 63
  • 18 years is the average length of retirement
  • 13% of the US population is over age 65 today
  • 6.1K Americans turn 65 each day
  • 10.K Americans retire every day
  • 55% of Americans retired earlier than they expected (health, job loss)
  • 12% of retirees continue to work seasonally or part time after age 66

SAVING

  • 80% of Americans do NOT believe they will have enough saved for retirement
  • 77% of US individual financial assets are held by Americans over age 50
  • $45K is the average retirement savings for people aged 55-64
  • $100K is the average retirement savings for people aged 65
  • $240K is the average spending for healthcare alone for couples over 65
  • 25% of employees fail to save enough to reach their employers 401k match
  • 34% of Americans do not have $2K available if needed for emergency

SPENDING

  • 60% of Americans spend all or more than they make each year
  • 44% of Americans do not have a simple budget
  • 66% of US adults are unable to pass a simple financial literacy test
  • 47% of new automotive spending in the US is done by Americans over age 50
  • 80% of luxury travel spending in US is done by Americans over age 50

DEBT

  • 19% of Americans occasionally overdraw their checking account
  • 21% of Americans have past-due medical bills
  • 50% of new retirees continue to have a mortgage for their primary home
  • 3% of seniors over 65 still have unpaid student loans
  • 40% of the Baby Boom generation (age 53-71) have more debt than savings
  • 39% of Americans classified with ‘expensive credit card behaviors’ in the last year
  • 18% were contacted by debt collection agencies in the last year
  • 9% of Americans report their homes being ‘under water’
  • 16% of Americans received ‘payday loans’ or sold things at pawn shops in 2015

SOCIAL SECURITY

  • $1.3K per month or $15.6K a year is the average Social Security payment
  • 36% of adults over 65 are entirely dependent on Social Security
  • 63% of adults over 65 are dependent on Social Security, family, friends or charity
  • 2033 is the year Social Security benefits will be reduced by 23% unless reformed
  • 20% of Americans have already taken a 401k loan/withdrawal, averaging $8K

HEALTH CARE

  • 15% of employers offer health insurance to retirees
  • 2x rate of inflation – Healthcare costs are expected to risen the next 5 years
  • 62% of senior healthcare costs are covered by Medicare
  • 90% chance that one spouse age 65 will live to be age 90

Sources:

21 thoughts on “Numbers To Put Your FIRE Journey In Perspective

  1. This jumped out at me: “18 years is the average length of retirement” That’s an awfully short amount of time. After a grueling 40 year career. And “60% of Americans spend all or more than they make each year.” Always baffles me. Why are people spending money that they don’t have?????? This tells us maybe we should maybe impose some regulations on how much credit one can borrow. It’s just too easy to over-consume for the vast majority of people.

    Liked by 1 person

    • Yes – it is an awfully long period of time. If the average retirement age is 63, that means the life expectancy of a 63-year-old is about 81. As far as more government regulations… You will never hear me think that is a good idea. The governments job is not to protect stupid people from themselves. 😉

      Like

  2. Quite a set of stats, Chief! I’ve always wondered about the $240K healthcare spending for couples over 65. Given the $100K average retirement savings for people at 65, how is it possible to spend 2.5X more? Even with Medicare, the gap seems insurmountable, given food, housing, transportation, etc. must be paid, too.

    Liked by 1 person

    • I suppose the average retirement savings amount does not include Social Security or pension payments. Given the average Social Security payment, the average couple would bring in $576K from that alone.

      Liked by 1 person

      • OK, that makes more sense. Those medical expenses are still a huge chunk. Doctors, lawyers, and undertakers seem to make out no matter what happens to the rest of us. 😉

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  3. I love this! I’ve been looking for a comprehensive list such as this because I’ve been curious about savings and retirement in the US. Can I repost this to my blog? http://www.thiswifeslife.com? I would of course give you credit and include back links. Thank you for your consideration.

    Catherine This Wife’s Live

    On Mon, Jun 19, 2017 at 2:26 AM, Mr.FireStation wrote:

    > MrFireStation posted: ” No words of wisdom from the FIRE Station this > morning – just some interesting numbers to put your journey to FIRE into > some perspective: AGING 50% of Americans are retired at age 63 18 years is > the average length of retirement 13% of the US populat” >

    Liked by 1 person

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  5. Startling statistics on their own but then to see them all in one place, wow! While all are significant, these 2 jumped out at me:
    – 55% of Americans retired earlier than they expected (health, job loss)
    – 80% of Americans do NOT believe they will have enough saved for retirement
    Yikes! Got to keep on educating these people and hope something finally clicks with them.

    Liked by 1 person

  6. This makes me feel like I am doing a ok on my savings. I guess if looked from the perspective of average Americans versus those obsessed with FIRE, my savings rate is stellar. Thanks for the info in such an easy form.

    Liked by 1 person

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  8. Pretty eye opening stats – thanks for compiling and sharing! I have always felt like I was behind in terms of savings because I spent nearly all of my 20s earning my PhD and didn’t have the forethought to start funding my retirement until I got my first job (turns out opening a Vanguard account is SUPER easy). However, just by prioritizing savings these past 4 years I’ve more than doubled what the average 65 year old has.

    Do you mind if I share this info with my readers? I think it is pretty powerful info that will help motivate others.

    Liked by 1 person

  9. It often seems that the increased difficulty of employment in 50’s and 60’s is overlooked. Based on people I know ageism is alive and well. My father ended up retiring early then expected due to company downsize and inability to find another position due to age close to retirement. My mom had retired (planned) months earlier. They are luck to have her pension but things are very tight.

    Liked by 1 person

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