Though most people would agree that saving is important for the future, almost half of Americans die nearly broke.
The data
This unfortunate reality isn’t new: a 2012 study by the National Bureau of Economic Research found that of the general population, 46 percent of retirees die with $10,000 or less in their savings account. That number spikes to 57 percent among retirees who are single.
A recent study by GoBankingRates put this issue in the spotlight again. The study showed that 69 percent of the adults surveyed had less than $1,000 in the bank.
Out of the 7,000 adults surveyed by GoBankingRates, one-third of them even said they have nothing in their savings account.
The problem doesn’t get better with age: only 37 percent of seniors 65 and older claimed to have $1,000 or more in the bank.
Even taking assets, such as homes, into account, the stats aren’t looking good. A total of 57 percent of single-adult households, and half of all widowed households, had no housing equity to show when they died.
Why is it worse for senior citizens?
This problem is not just relevant postmortem; it affects seniors throughout their retirement as well.
Though many Americans aren’t prepared to cover unexpected expenses, working-age people can increase their hours to cover extra costs.
When it comes to retired seniors with no savings, they are in a much worse predicament. Retirees who don’t have a financial cushion can’t pick up extra shifts to close the gap, forcing them to take on debt.
Seniors without savings also cannot cover unexpected expenses that arise. This is especially problematic because on top of facing emergencies, seniors may have to handle massive medical bills. Because of this, seniors are forced to resort to loans when disaster strikes; the average senior carries more than $6,300 of credit-card debt.
Takeaway
In order to prepare for retirement, working folks must begin saving as soon as possible. Though saving can seem difficult, and even impractical at times, it is crucial to secure savings for the future.
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