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68% of Americans Worry They Won't Have Enough Money to Retire

By Maurie Backman – Feb 8, 2020 at 6:18AM

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Here's what to do if you feel the same way.

Retirement is an expensive prospect. Between general expenses and the uptick in medical bills so many seniors face, it takes a fair amount of money to manage financially during that period of life.

It's no wonder, then, that a large number of workers today feel anxious about entering their golden years. In fact, 68% of Americans worry they won't have enough money to retire, according to a recent Capital One survey. If you share that concern, here's what to do.

Older man and woman looking at documents.

IMAGE SOURCE: GETTY IMAGES.

1. Start saving immediately

As a general rule, you should expect to need about 70% to 80% of your former income to live comfortably in retirement. Social Security may provide about half that amount if you're an average earner, so the rest will need to come from your own savings.

The good news? If you have a number of years between now and retirement, you won't need to part with a huge chunk of money each month to build a substantial amount of wealth. Let's assume you have 20 years between now and the end of your career. Here's what your IRA or 401(k) balance might grow to, depending on your monthly contributions:

Monthly Savings Amount

Total Accumulated Over 20 Years (Assumes a 7% Average Annual Return)

$300

$148,000

$400

$197,000

$500

$246,000

$600

$295,000

$700

$344,000

TABLE AND CALCULATIONS BY AUTHOR.

Now, one thing you should note is that the 7% return above assumes you'll have your retirement savings invested heavily in stocks. Play it safer, and you may see lower returns that reduce the above totals. But if you're 20 years away from retirement, you shouldn't have a problem loading up on stocks, since that gives you plenty of time to ride out market downturns and come out ahead.

2. Plan to delay your Social Security benefits

The more money you get from Social Security, the easier it'll be to pay your bills once your time in the workforce comes to an end. You can collect the full monthly benefit you're entitled to based on your earnings history once you reach 67 if you were born in 1960 or later. But if you delay benefits past that point, you'll boost them by 8% a year, up until you turn 70. And that should give you some extra leeway and peace of mind as a senior. It can also help compensate if you're not able to boost your personal savings as much as you'd like to.

3. Rethink your lifestyle

The 70% to 80% replacement income threshold mentioned above isn't set in stone. If you're willing to live very frugally as a senior, you may be able to get away with spending less. And that's a possibility you may need to prepare for if you don't have much retirement savings and don't have a huge window of time ahead of you to catch up.

What adjustments might you need to make? You may need to downsize your home, move to a less costly part of the country, or even work part-time to generate more income. But if you're willing to be flexible, you may manage to retire without financial stress.

It's natural to be concerned that you won't have enough money to retire. But rather than fixate on your fears, take steps to build savings, maximize your Social Security income, and map out a retirement plan that allows you to make the most of your financial resources. With any luck, you'll wind up enjoying your golden years, even if that means doing things a little differently than initially planned.

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