Many of us spend years dreaming about our retirement. But if we’re being honest, the prospect of life after work also scares us a little.
The idea of ââtrying to finance decades of jobless retirement causes anxiety. Fortunately, we can look to those who are successfully navigating retirement today for clues on how to make our golden years successful tomorrow.
Here are some key things today’s âcomfortableâ retirees have in common: according to recent findings from the Employee Benefit Research Institute (EBRI) Spending in Retirement survey.
For the analysis, retirees were divided into five groups based on their financial status and self-reported spending behavior, with retirees considered âcomfortableâ being second best:
- Wealthy retirees
- Comfortable retirees
- Average retirees
- Retirees in difficulty
- Retirees “on the way out”
Middle income levels
We would all like to get rich before we retire. But the reality is, most of us aren’t meant to be the next Jeff Bezos or Bill Gates.
That doesn’t mean, however, that we should throw in the towel on wealth accumulation. While the ranks of the dirty rich may be beyond our reach, we can still retire with sufficient income to make our lives comfortable.
EBRI data shows that retirees it considers “comfortable” report annual incomes similar to those the EBRI classifies as “average retirees,” between $ 40,000 and $ 100,000.
Find out how you can generate this kind of income by signing up for the Money Talks News course The only retirement guide you’ll ever need.
Multiple sources of income
Where do comfortable retirees get their income? From multiple sources, according to EBRI data.
These retirees know it is wise not to end up with all of their eggs in one basket. A person who gets money by investing in stocks and bonds, a pension and social security is in better shape than someone who depends on just one of these sources of income.
Are you looking for a new source of liquidity? Find out â21 Ways Retirees Can Make Extra Money in 2021â.
No more accumulated assets
While comfortable retirees report similar income levels to average retirees, they have more accumulated assets. Average retirees have financial assets valued at $ 99,000 or less, while comfortable retirees have accumulated assets of between $ 99,000 and $ 320,000.
Retirees classified as “rich”, on the other hand, reported assets of $ 320,000 or more.
Easily manageable debt
EBRI says debt is a key factor in retiree anxiety and dissatisfaction. It also contributes to a low standard of living.
Comfortable retirees have debts that EBRI describes as easily manageable.
Among the average retiree, by comparison, almost half have credit card debt and slightly fewer have car loans.
If you’re trying to get out of the red, stop by the Money Talks News Solution Center and find experts who can help you get rid of your debt.
Guaranteed sources of liquidity
Retreats may be following the dinosaur’s path, but comfortable retirees are going against that trend. They – as well as wealthy and even middle-income retirees – are more likely to have guaranteed sources of income such as a pension plan compared to retirees in âstrugglingâ or âemergingâ groups.
Reasonable expense expectations
Being likely to have sufficient retirement savings – or even more than that – leaves comfortable retirees not only happy with the present, but also confident about the future.
You are not going to surprise comfortable retirees declaring: âEat, drink and rejoice! Instead, they are likely to “plan to grow, maintain or spend only a small portion of their financial assets in retirement,” reports the EBRI.
A good attitude
Comfortable retirees enjoy life after work. Whether you are rich or poor, a good attitude goes a long way in improving retirement.
In fact, retirees that the EBRI classifies as âcomfortableâ are the second most satisfied of all retirees when it comes to life after work. The only retirees who are happier are those classified as “wealthy.”
Who Said Money Can’t Buy Happiness?
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