While reports draw concerns from retirees who are worried of outliving their savings, new research from Clever finds some have already depleted their retirement income.
According to Clever’s “State of Retirement Finances: 2024 Edition,” which surveyed 1,000 retired Americans, 19% of retirees have exhausted their retirement savings and 23% believe they won’t have enough savings to cover their eventual funeral expenses.
The situation is especially concerning among retired women, who are 33% more likely than men to say they don’t have enough savings for retirement, Clever reports. Women were also likelier to have nothing saved at all, at 28% compared to 20% of men.
Of all retirees surveyed, 46% have no back up plans if their savings run out, 12% rely entirely on their Social Security benefits for income, and 60% trust the federal agency to cover at least half of their retirement income. Another 15% completely rely on their children for financial support.
Retirement planning crisis
The findings support a common assertion seen in the retirement planning industry—that the U.S. has a deep retirement savings problem. Nearly seven in 10 say the current economic climate has impacted their retirement finances, and two in three agree that the country has a crisis in its hands.
Others place blame on their employers, with 55% of respondents adding that their company did not do enough to help them save for retirement. Close to 45% of women say their income was not high enough for them to contribute to a savings account, with 54% of women more likely to say so than men.
As a result, retirees say they are spending less due to high costs (47%), feeling the effects of inflation eating into their savings (32%), moving money into less risky investments (10%), and preparing to lose even more money (8%).
Lack of planning
Some respondents in Clever’s survey place the responsibility of saving to themselves, with 25% reporting feeling ashamed for their lack of planning.
About 57% of retirees say they have regrets about their retirement, including:
- Not knowing how much they needed in savings to retire (56%)
- They should have managed their money better before retiring (54%)
- They waited too long to start saving for retirement (49%)
- They didn’t prepare adequately for retirement (47%)
- They didn’t understand how their retirement savings would be taxed before they retired (37%)
- They wish they had invested in more high-risk/high-reward assets when they were younger (31%)
- They took Social Security benefits too early (25%)
- They dipped into their retirement savings before retiring (19%)
According to the findings, 59% of retirees did not start saving for retirement until their 30s, 33% waited until their 40s, and 13% never even started saving.
Other respondents mentioned owing too much debt, with the average retiree having a non-mortgage debt balance of $15,393. The most types of debt among retirees are credit card debt (42%), mortgage debt (26%), auto loan debt (17%), medical debt (13%), and personal loans (11%).
Rejoining the workforce
With 34% of retirees spending money faster than initially expected in retirement, 25% say they are considering rejoining the workforce, either through part-time, full-time, or consulting/freelance work.
The most common ways retirees plan to make more money for their retirement years include part-time employment (22%), selling their possessions (18%), moving to an affordable area (15%), picking up paid tasks like yard work or babysitting (12%), downsizing their homes (10%), consulting/freelancing (4%), and full-time employment (4%).
Others would rather spend their retirement in bliss, with 52% prioritizing enjoying their retirement rather than worrying about preserving their finances.
Additional findings from Clever’s survey can be found here.
SEE ALSO:
- The Top Retirement Stats for 2024
- Most Americans Saving for Retirement, But Many Don’t Know How Much They’ve Saved
- Americans Saved More in 2023
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.