Just over a decade ago, the United States plunged into the Great Recession. Stocks plummeted, home prices dropped and unemployment skyrocketed. One of the lasting effects was the evolution of retirement.
Fast forward to today. The country is bracing itself for a shift in the workforce as the baby boomer generation moves toward retirement. This shift makes way for an even larger generation, millennials, who make up the largest group in the American workforce. Now, they are continuing to shape the evolution of retirement.
As millennials and baby boomers think about funding their retirement years, both groups should take these new rules of retirement into account.
5 New Rules for Retirement
- People Are Retiring Later
Baby Boomers have had to deal with job losses, falling home prices and investment portfolio losses, so retirement has been delayed for many of them. Of those over 60 and working, 57% of men and 48% of women say they are putting retirement on hold, according to a recent CareerBuilder survey. Four in 10 (40%) workers say they won’t be able to retire before 70. Implementing a retirement strategy early can ensure you’re prepared to retire at an age that you choose.
- You Can’t Rely on Social Security
The Social Security Administration’s Trustees Report of 2019 states that total expenditures have exceeded non-interest income of its trust funds since 2010, and they anticipate that the cash-flow deficit will continue. Depending on Social Security as retirement income is no longer a wise plan. As retirement continues to evolve, it’s going to be up to the next generation of retirees to ensure that they have planned for their future financial needs.
- Selling Your Home Isn’t a Good Way to Get Money for Retirement
- A Longer Life Expectancy Means Needing Additional Savings
In a recent survey, respondents said they consider healthy lifestyle habits, such as a proper diet, regular exercise and preventive care, as a way to reduce healthcare costs. Healthcare expenses can be a major factor in retirement funding. Despite a greater focus on well-being by retirement-aged individuals, the longer retirees live, the more money they will need saved. Cutting back on non-necessities is one way to deal with needing additional savings, but healthcare expenses and other necessary costs aren’t easily reduced.
- Managing Retirement Accounts has Become More Hands-on
Many areas of the U.S. continue to reflect home prices that haven’t fully recovered from the last recession. The continually rising home values that retirees counted on in the past are no longer guaranteed. Retirement funding should consider this reality.
Saving for retirement no longer means setting up your portfolio and forgetting about it. It requires a more hands-on approach. And we are here to help. Our Farm Bureau agents know the ins and outs of which strategies will work for you.
Farm Bureau Can Help You Plan for Retirement
If you want to plan for your future, but you aren’t sure where to start, connect with a Farm Bureau agent in your area to discuss your future financial opportunities. Protect your family by finding the best retirement strategy for you!