COMP NEWS – Future Americans will be working harder and longer in their old age according to a new survey that indicates most workers today won’t be able to afford to retire until their 70s..
The future of retirement in America is looking bleak, with 83% of Americans predicting that most people will have to work into their 70s in order to afford to retire[1][2]. This statistic is a reflection of the current state of the economy, which is characterized by rising education costs, a shift of economic risk from companies to individuals, and a lack of financial literacy classes in high school[2][4][6].
The situation is particularly severe for young people, with 57% of 22–24-year-olds facing financial precarity[3]. However, it’s important to note that younger people are in the best position to recover if they’ve fallen behind because they have more time to use compound interest to their advantage[1].
Multiple factors are contributing to Americans making and saving less, though the rising cost of education worries young people the most.
The rising cost of education is one of the main factors contributing to the bleak outlook for retirement. According to a survey conducted by Pew Research Center, 54% of teenagers are worried about affording higher education[2]. Additionally, 70% of teens said that rising higher education costs have affected their post-graduation plans[2]. This is a significant concern, as higher education is often seen as a key factor in achieving financial stability and success.
Another factor contributing to the bleak outlook for retirement is the shift of economic risk from companies to individuals. According to Pew Research Center, 72% of Americans expect older adults will be less prepared financially for retirement in 2050 than they are today[1]. Additionally, 83% of Americans predict that most people will have to work into their 70s in order to afford to retire[1]. This shift of economic risk is a result of the decline of traditional pension plans and the rise of defined contribution plans, such as 401(k)s, which require individuals to take on more responsibility for their retirement savings.
To read more about the survey, click here.
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