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Being able to take advantage of the opportunities retirement may hold requires
more planning than ever, for several reasons.
- Longer retirements. People are simply living longer, which makes for longer retirements. That’s compounded by the fact that people are also retiring earlier.
1940: 11% of life spent in retirement
Retirement Age: 69.1
Avg. Life Expectancy: 77.6
2000:
20% of life spent in retirement
Retirement Age: 65
Avg. Life Expectancy: 80.9
|
|
Source: "Income of the Aged Chartbook, 1998", June
2000 Edition, U.S. Dept. of Health and Human Services Average
life expectancy from Bureau of the Census based on male age
65. Retirement age from Social Security Administration.
|
- Inflation.
Steady inflation ensures that you can expect to pay more for everything
in retirement – from gas to groceries to vacations.
| |
1970 |
1997 |
%+ |
| Toothpaste |
$0.25 |
$1.87 |
648% |
| Tide |
$0.49 |
$3.44 |
602% |
| Disney Ticket |
$7.00 |
$39.75 |
468% |
| Cheeseburger |
$0.16 |
$0.90 |
463% |
| Soup |
$0.12 |
$0.92 |
667% |
| Gasoline (gal.) |
$0.22 |
$1.29 |
486% |
| Total Average |
556% |
| Wage Increase(1) |
486% |
| Net |
(276%) |
|
(1) DOL Bureau of Labor Statistics: Total Private Average Hourly Earnings. |
- Less
support from other sources.
Traditional sources of retirement income, such as social
security and pensions, account for only 57 percent of retirement income.
|
Retirement Income Sources
|
 |
* Includes private pensions and annuities,
government employee pensions,
Railroad
retirement, and IRA, Keogh, and 401(k) payments.
Source: "Income of the Aged Chartbook, 1998,"
June 2000 Edition, Social Security Administration |
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