Many of us spend years dreaming about our retirement. But if we’re being honest, the prospect of life after work also scares us a bit.
The idea of trying to fund decades of retirement without work is worrying. Fortunately, we can look to those who are successfully navigating retirement today for clues about how to make our golden years successful tomorrow.
Here are some of the main things “comfortable” retirees have in common today, according to recent results from the Employee Benefits Research Institute (EBRI’s) “Retirement Expenditure Survey.”
For the analysis, retirees were divided into five groups based on their self-reported financial status and spending behaviour, with “comfortable” retirees ranked second:
- Wealthy retirees
- Comfortable retirees
- average retired
- Struggling retirees
- Retirees ‘about to get it’
middle income levels
We all like to get rich before we retire. But the truth is, most of us are not destined to be the next Jeff Bezos or the next Bill Gates.
However, this does not mean that we should ignore the accumulation of wealth. While the mattresses of the dirty rich may be out of our reach, we can still retire with enough income to make our lives comfortable.
EBRI data shows that retirees deemed “comfortable” by annual income reports are similar to people the institute classifies as just “intermediate retirees,” in the neighborhood of $40,000 to $100,000.
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Multiple sources of income
Where do comfortable retirees get their income from? From multiple sources, according to EBRI data.
These retirees know the wisdom of not sticking all their eggs in one basket. A person who gets money from investments in stocks, bonds, pension and social security is in better shape than someone who depends on only one of these sources of income.
Are you looking for a new cash source? Check out “21 Ways Retirees Can Bring in Extra Money in 2021.”
More assets accumulated
While comfortable retirees report income levels similar to those of regular retirees, they have more in accumulated assets. Average retirees have financial assets valued at $99,000 or less, while comfort retirees have accumulated assets of between $99,000 and $320,000.
On the other hand, retirees classified as “wealthy” reported having assets of $320,000 or more.
Debt that can be managed easily
EBRI says debt is a major factor in retiree anxiety and dissatisfaction. It also contributes to a lower standard of living.
Comfortable retirees have debts that EBRI describes as easy to manage.
By comparison, nearly half of the average retiree have credit card debt and only slightly fewer have car loans.
If you’re trying to get out of the red, stop by the Money Talks News Solution Center and find experts who can help get out of your debt.
Pensions may be going the dinosaur’s way, but comfort retirees are bucking the trend. They – along with wealthy and even middle-class retirees – are more likely to have guaranteed sources of income such as a pension plan when compared to retirees in the “struggling” or “struggling” groups.
Reasonable spending expectations
Chances are that having enough retirement savings – or even an amount above that level – leaves comfortable retirees not only satisfied in the present, but also confident in the future.
You won’t catch comfy retirees saying, “Eat, drink and be happy!” Instead, they are more likely to “plan to grow, maintain or spend only a small portion of their financial assets in retirement,” according to the EBRI report.
Comfortable retirees enjoy life after work. Whether you are rich or poor, a great attitude goes a long way in improving retirement.
In fact, retirees that EBRI rates as “comfortable” are the second most satisfied retirees when it comes to their after-work life. The only happiest retirees are those classified as ‘rich’.
Who says money can’t buy happiness?
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