You may already know that there are 75.4 million baby boomers; but did you know that translates into 10,000 baby boomers turning 65 every day from now until 2029? Given that so many baby boomers are entering their golden years, let's learn what's in store for them when they hit retirement age.
No. 1: Guessing game
According to a 2015 study by Transamerica, almost half of baby boomers are determining their retirement savings needs by guesswork. Only 11% actually used a retirement calculator to figure out what they really will need to sock away for their golden years.
No. 2: Tight-lipped
Baby boomers are pretty shy about opening up to their family and friends about money. According to Transamerica, only 9% of baby boomers frequently discuss money matters with the people closest to them.
No. 3: Falling short
Although workplace savings plans have become pretty common, nearly 20% of baby boomers don't contribute to plans such as a 401(k). Even those baby boomers who are saving for retirement aren't socking enough money away. The median savings of a baby boomer is just $127,000. Given that experts recommend no more than 4% is withdrawn from retirement savings each year in retirement, that nest egg translates into less than $5,100 per year in retirement income.
No. 4: Social Security conundrum
Millions of baby boomers will rely on Social Security income in retirement, but did you know that Social Security only replaces an average of about 40% of a recipient's pre-retirement income? On average, the retired worker is collecting just $1,341 per month from Social Security in 2016.
No. 5: The un-"safety net"
Although Social Security is supposed to provide a safety net for retirees, the sheer size of the baby-boom generation will deplete Social Security's Trust Fund in 2029, according to the Congressional Budget Office. If so, then the CBO estimates that all retiree benefits could be cut by 29% in 2030.
No. 6: Antsy about the future
Transamerica's study finds that limited retirement savings and Social Security's uncertainty translates into just 13% of baby boomers being "very confident" that they'll be able to fully retire with a comfortable lifestyle.
No. 7: Revolutionizing retirement
Given that backdrop, more baby boomers expect to work beyond 65 than any previous generation. A whopping 65% of baby boomers expect to work past that magic mark, and more than half of baby boomers plan to keep on working in some capacity in retirement.
No. 8: Finding that work
Despite so many baby boomers wanting to work later in life, many employers haven't changed their policies in ways that could allow them to. For example, Transamerica notes that only 48% of employers surveyed allow employees to switch from full-time to part-time.
No. 9: Bridging the gap
Baby boomers face retirement challenges, but increases in savings now can still pay off big in retirement. For example, people over 50 can contribute an additional $6,000 catch-up contribution per year to their 401(k) plans. Do that every year for 15 years in something that earns a hypothetical 6%, and you can boost your retirement savings by an additional $139,658.