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They key is --- always live on less than you earn!
Prudently invest the difference.

from https://finance.yahoo.com/news/guess-many-americans-successfully-retire-171702140.html

Can You Guess How Many Americans Successfully Retire With $1 Million
Saved? The Percentage May Shock You
932
Jeannine Mancini
Tue, December 5, 2023 at 9:17 AM PST·4 min read
In this article:

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Saving for retirement is an essential goal for many Americans, but
achieving the ideal savings target remains elusive for many. In 2023,
the average American retiree had about $170,726 in retirement savings, a decrease from $191,659 at the beginning of 2022. This 10% reduction is significantly lower than the recommended $555,000. Only 12% of retirees
have achieved or exceeded this recommended savings amount.

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The Challenge Of Insufficient Retirement Savings
A startling 37% of retirees report having no retirement savings, an
increase from 30% in 2022. This lack of savings is attributed to various factors, including unplanned early retirement because of health issues,
as experienced by 65% of retirees. A significant portion of retirees — approximately 71% — carry non-mortgage debt averaging $19,888, which
includes medical debts and other expenses.

Only a small fraction of retirees — around 8% to 10% — have successfully saved $1 million or more. This figure highlights the substantial
challenges many face in reaching such a lofty savings goal, with the
majority of retirees falling well short of this mark. This situation underscores the need for more effective retirement planning and saving strategies.

Factors Impacting Retirement Planning
The retirement landscape in the U.S. has been shaped by multiple
factors. Notably, 65% of retirees stopped working earlier than planned,
with health concerns being a major factor. This premature retirement
often results in lower overall savings. High inflation rates in recent
years also have significantly affected the value of retirement savings.
As a result, 83% of retirees reported that inflation impacted their
retirement savings, with many experiencing major financial impacts. This economic environment has compelled retirees to reassess their living
expenses, with 44% struggling to afford necessities like groceries,
housing, utilities and medical expenses.

Story continues
Retirees have expressed various regrets regarding their retirement
planning. A majority admit they did not prepare adequately, with 51% acknowledging their lack of sufficient preparation. Common regrets
include a lack of understanding about retirement savings, poor money
management before retirement and underestimating the amount needed for a comfortable retirement. Many retirees also wish they had been more
aggressive with their investments earlier in life.

As a result of these financial challenges, retirees have had to make significant adjustments to their lifestyles. Approximately 45% report a
decline in their standard of living since retirement, leading to reduced spending on nonessential items like entertainment, travel and dining
out. Spending on essentials such as groceries, gasoline and healthcare
has increased, reflecting the impacts of inflation.

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Strategies For Achieving A Comfortable Retirement
Given these findings, it’s clear that achieving a comfortable retirement requires careful planning, consistent saving and strategic investment decisions.

Here are key strategies to consider:

Start saving early. Begin retirement savings early in your career to
take advantage of compound interest.

Make regular contributions, even if they are small, as they can
accumulate significantly over time.

Focus on debt reduction. Aim to reduce or eliminate high-interest debts,
such as credit card balances.

Consider paying off mortgages before retirement to decrease monthly
expenses.

Consult with a financial adviser for personalized advice tailored to
your financial situation and goals. Financial advisers can help in
creating a diversified investment portfolio to manage risk and maximize returns.

Contribute the maximum amount to retirement accounts like 401(k)s and individual retirement accounts (IRAs) to take full advantage of tax
benefits and employer matches.

Spread investments across various asset classes to reduce risk. Include
stocks, bonds, real estate and other alternative investments like art,
which has seen has seen a 13.8% annualized return, surpassing the 10.2%
from the S&P 500​.

Regularly rebalance your portfolio to maintain the desired asset allocation.

Build an emergency fund to cover unexpected expenses. This prevents the
need to withdraw from retirement savings prematurely.

Delay Social Security benefits. If possible, delay taking Social
Security benefits until full retirement age or later to maximize the
monthly benefit amount.

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This article Can You Guess How Many Americans Successfully Retire With
$1 Million Saved? The Percentage May Shock You originally appeared on Benzinga.com

.

© 2023 Benzinga.com. Benzinga does not provide investment advice. All
rights reserved.

JG
5 December, 2023

You fairly frequently read how janitors and teachers have left millions
to communities and scholarship funds. These are not highly paid people
and likely lived below their means, invested and started saving early. Certainly life and deal a person setbacks and the expense of children
can be a burden but it does seem that a fair amount of people live at or
above their means and not paying themselves (money into retirement)
before paying others. Money spent on Starbucks, having manicured nails,
the latest mobile phones and other ways to fritter way your income
probably could be better spent by putting that money into an index fund.


ky
2 days ago

you got that right. index fund = VOO (S&P500) beats 96% of all actively
traded funds. source? john bogle of vanguard.


Brian K
2 days ago

I can assure you there are a million janitors, who do not have 100k
saved up. Been an Insurance Agent a long time, many folks, MANY... can
not save... and simply live, try to save a little to buy a new car, a vacation, but retirement funds. Most cut that out, unless they have a
401k rolling. USA lost it way with greed, when you have CEO like at GM,
who makes more in one month than some of her workers will in their
lifetimes, that is where the problem begins.

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