Many workers worry about affording retirement, and understandably so. It isn't easy to shift from a steady paycheck to what's effectively an extended period of unemployment, and if you go in unprepared, there's a good chance you'll wind up miserable. Here are just a few reasons you might end up struggling financially during your senior years instead of enjoying them.

1. You're banking on Social Security alone

Social Security may be an extremely helpful source of income for you in retirement, but it won't be enough to pay your bills entirely. Those benefits generally replace about 40% of the average worker's pre-retirement income, and most seniors need around 70% to 80% of their former earnings to maintain a decent standard of living.

Older woman looking at laptop with serious expression while older man standing behind her touches her shoulder


If you're planning to fall back on Social Security alone during retirement, don't. Instead, make an effort to build savings of your own. If you have access to a 401(k) through your employer, you can sock away up to $19,500 a year if you're under 50, or $26,000 if you're 50 and over, in a tax-advantaged fashion. No 401(k)? You can still make great strides with an IRA, whose current contribution limit is $6,000 for workers under 50, and $7,000 for the 50-and-over set.

And if these limits seem daunting, worry not -- you don't actually need to hit them to build a substantial amount of wealth. If you were to set aside just $300 a month over 30 years, and invest that money at an average annual 7% return, which is a few percentage points below the stock market's average, you'd wind up with $340,000. And that, combined with Social Security, could make for a nice lifestyle.

2. You're underestimating your lifespan

The Social Security Administration expects the average man who turned 65 last year to live until 84, and the average woman who turned 65 last year to live until 86 1/2. But these are just averages, and one in three 65-year-olds today is projected to live past the age of 90.

As such, if you're planning to retire in your mid-60s, don't assume that you only need enough savings to pay for 10 to 12 years of living expenses. There's a good chance you'll need twice that amount, and if you don't manage to accumulate enough savings, you may have a truly hard time paying your bills once you're no longer working.

3. You're not planning to make any lifestyle adjustments

A financially healthy retirement often hinges on compromise, especially when you kick off your golden years with less savings than you'd like. If you currently enjoy taking expensive vacations, driving a nice car, and living in a large home, you can continue doing so as a senior if you have the money to support that lifestyle. But if you don't, you'll need to make changes early on to ensure that you don't deplete what limited savings you have.

A good way to keep yourself in check in this regard is to create a retirement budget. See what your monthly income looks like based on your savings and Social Security benefits, and then make sure your recurring expenses stay within that limit. Otherwise, you may run out of money somewhere along the lines, leaving yourself to struggle for years afterward.

You deserve a retirement that's devoid of money-related stress. Avoid the above mistakes, and you'll hopefully manage just fine financially once your time in the workforce comes to an end.