The classic retirement shot, a couple, dressed in white, on the beach.
Pensions for people employed outside the public sector are vanishing. The defined-contribution plans that have replaced them aren”™t cutting it. According to Fidelity Investments, the average 401(k) account belonging to someone at least 55 years old is worth $165,000. (And those people are lucky. They actually have workplace retirement accounts.) The Federal Reserve says the median amount held in all retirement accounts””individual or workplace””where the head of the household is at least 35 but hasn”™t yet reached the official retirement age of 65 is $59,000.
I suspect the Canadian numbers are similar.
The concept that people will be able to work into their late 60s, 70s and beyond is a false hope:
Working longer is a retirement plan like winning the lottery or dying earlier is a retirement plan. Being able to work longer is not a plan. It”™s a hope.
Teresa Ghilarducci has more to say about the pending retirement crisis here.
I have a number of friends that have recently decided to retire.
They are all in their late fifties or early sixties. And they all have defined pensions and savings.