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Newsweek
26-04-2025
- Business
- Newsweek
Americans Fear Going Broke More Than Death, Study Shows
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. Nearly two in three Americans (64 percent) are more scared of running out of money than dying, a new study has found. The Allianz 2025 Annual Retirement Study, which surveyed 1,000 U.S. workers aged 25 plus, found that the majority of millennials, Gen Xers and baby boomers harbor fears about dwindling savings, namely when they stop working. Gen Xers, for whom retirement is fast approaching, were most concerned, with 70 percent saying they have a greater fear of financial instability later in life than death. Among millennials, 66 percent said they feared running out of money more. Boomers, who are often thought to be more financially secure due to retirement benefits and accumulated wealth, still had 61 percent say they feared financial ruin more than the end of life. Mark Turner, a retired financial professional and founder of told Newsweek that during his decades-long career, he has witnessed first-hand the fear among workers preparing their finances for later in life. Americans Fear Going Broke More Than Death, Study Shows Americans Fear Going Broke More Than Death, Study Shows Photo-illustration by Newsweek/Getty "I wasn't shocked," he said of the study results. "I've literally had people call our office in tears saying, 'I don't care if I die tomorrow, I just don't want to die broke.'" The study identified the top reasons why people are so concerned about their financial futures. Leading the list was high inflation, cited by 54 percent of respondents. Tied in second place at 43 percent each were high taxes and doubts that Social Security will provide adequate support in retirement. In 2015, Social Security benefits represented about 31 percent of the income of people over age 65, according to the Social Security Administration data released in 2024. Thirty-nine percent said they could imagine a future where Social Security—which is distributed to nine out of 10 people age 65 and older—no longer exists at all. The Sandwich Generation Gen X—those born between 1965 and 1980—were the most likely to be scared of running out of money over a fear of dying. Tom Buckingham, chief growth officer at Nassau Financial Group and retirement planner, told Newsweek that this is for a number of reasons. "Gen Xers will not be able to depend on guaranteed income for life the same way most of their parents are due to concerns around Social Security and a significant shift away from defined benefits plan (pensions) to defined contribution plans like 401(k)s, which puts the onus on individuals to create their own spending plan," he said. "Also, I think their lifestyles are different than boomers', many of whom were raised by parents who grew up during the Great Depression and carried that with them throughout their lives." What's more, the cost of living is simply higher than it was, and while consumer prices and household incomes generally rise over time, this is hardly in tandem. "Families simply spend more today than they did decades ago, and that can be challenging when there will be fewer predictable sources of income in retirement," Buckingham said. Turner said that Gen X is experiencing the most financial pressure, coupled with the least amount of support. "They were told to save, invest, buy a house—and now they're sandwiched between college tuition for their kids and health care for their parents," he said. "They're close enough to retirement to feel the pressure, but still far enough that they need growth—and that's a tough line to walk." But the prospect of saving for a long retirement is still clearly a daunting task for all, with Turner saying people of all ages all share the same concerns regarding their money. "I've talked to millennials buried in student loans, Gen Xers stretched between aging parents and teenage kids, and boomers who did everything 'right' but still feel behind because inflation has chewed through their savings like termites in drywall." Buckingham said that while it may be difficult, all groups should think about ways to "generate more income and live within their means." "Most boomers should consider annuities that provide guaranteed income for life," he said, while "Gen Xers should consider secondary sources of income during their working years" to help save more toward retirement, "a portion of which they could use later to generate guaranteed income through those same types of annuities." Millennials, the youngest of the groups included in the survey, "simply haven't saved much yet, so it's hard to imagine accumulating enough assets to support themselves for decades in retirement," Buckingham said. "Millennials have so much time, and they should make that work to their advantage. The power of compound interest over decades is almost unimaginable."
Yahoo
26-01-2025
- Business
- Yahoo
5 Money Moves To Make in Early 2025 To Maximize Your Social Security Benefits
Boosting your Social Security benefits now rather than later will significantly help increase future payouts and plan for a comfortable retirement. Whether you're years away from retirement or approaching retirement age, taking small steps now could yield big benefits later. Social Security Benefits Might Be Harder To Qualify for in the Future: Explore More: 4 Low-Risk Ways To Build Your Retirement Savings in 2025 Here are five money moves to make in early 2025 to maximize your Social Security benefits. Older workers remain a strong and vibrant part of the nation's workforce. According to an Employee Benefit Research Institute (EBRI) report, the prime working age population (25 to 64 years old) has significantly fallen, and older workers are filling the gap, with baby boomers making up the largest share of the workforce. According to data collected by Vox, many boomers chose to remain in the workforce because they can't afford to retire, rising healthcare costs and longer life expectancies. Other older workers enjoy the structure and purpose that come with work and may not feel ready to retire. In addition, Social Security benefits are calculated based on an individual's highest 35 years of earnings. Therefore, if potential beneficiaries have fewer than 35 years of earnings or low earning years, those years are averaged as $0. Retirees should consider working extra years to find opportunities to increase their income to replace lower-earning years. This could significantly increase their average monthly earnings. Consider This: Tom Buckingham, the Chief Growth Officer at Nassau Financial Group, said the best thing retirees can do to boost their future Social Security benefits if they haven't claimed them yet is to wait another year or more to do so. 'The benefits of waiting to claim until as late as age 70 are significant,' Buckingham said. Retirees should consider their budget and determine whether they can rely on savings, part-time work or other income sources to postpone claiming. The Social Security Administration's Retirement Benefits Calculator can help older adults assess how waiting will affect their monthly benefits. Consult with a certified financial planner (CFP) who can provide personalized guidance and help navigate important questions and make informed decisions. 'You and your CFP should carefully review your current budget and estimate your cash flow needs,' said Melissa Murphy Pavone, founder at Mindful Financial Partners. 'Before taking retirement assets and potentially paying an early distribution if prior to age 59 ½, take a look at your emergency fund.' Pavone explained, 'Individuals often overlook the impact of healthcare costs in retirement. This added expense, if not accounted for, can quickly deplete retirement savings.' Mistakes in retirees' earnings records could cost them money. For example, if an employer didn't properly report one year of an employee's earnings to Social Security, the error could reduce an individual's future benefit payments. According to the Social Security Administration's website, 'Over your lifetime, that could cost you thousands of dollars in retirement or other benefits that you're entitled to receive. It's important to identify and report errors as soon as possible.' In addition, the longer retirees wait to report and correct errors, the harder it could be for them to get old tax documents. In addition, some employers may no longer exist or be able to provide past payroll information. Social Security should only be one piece of retirees' income strategy. Ideally, Social Security should be able to replace about 70 to 80% of an individual's income, and makeup around 40 to 50% of a person's overall retirement income. Financial advisors recommend having multiple income streams during retirement — including other savings and investments, pensions and retirement accounts — to maintain a comfortable retirement lifestyle. 'One great option is a fixed indexed annuity with guaranteed income benefits,' Buckingham said. 'These products are a great source of supplemental income for life. There are even products that allow the owner to take a higher income for a period of time, which could provide a bridge that allows them to delay claiming Social Security to enrich those benefits. Such a combination would be a strong foundation of a retirement plan.' More From GOBankingRates 4 Low-Risk Ways To Build Your Savings in 2025 3 Things You Must Do When Your Savings Reach $50,000 This article originally appeared on 5 Money Moves To Make in Early 2025 To Maximize Your Social Security Benefits Sign in to access your portfolio
