The Numbers Behind Retirement

A lot has changed about retirement. What hasn’t changed during the years I’ve been helping people with their retirement plans is the level of misunderstanding about retirement. People continually are surprised by facts and insights that haven’t changed much for a while. Christine Benz of Morningstar collected 25 pieces of important data that tell a lot about retirement and put them into a quick-hit article . She describes them as “shocking but true statistics.” Unfortunately for many people they are shocking and surprising. Here’s a sample:

45: Percentage of retirees who don’t factor inflation into their retirement planning.

13: Percentage of retirees who look at least 20 or more years into the future when planning for retirement.

21 and 17: Average number of years, respectively, that women and men in the U.S. will be retired.

25: Percentage of 401(k) participants ages 56-65 who had more than 90% of their accounts in equities at year-end 2007.

42: Percentage of the target equity weighting for those retiring in 2010 according to Morningstar’s Lifetime Allocation Indexes.

$1,000: Monthly Social Security benefit a retiree would receive if he begins collecting benefits this year, at age 62, assuming an annual income of $50,000.

$1,951: Monthly Social Security benefit if same retiree delays receipt of Social Security benefits until age 70.

72: Percentage of Social Security recipients who begin collecting benefits at age 62.

34: Percentage of retirees who rely on Social Security for 90% or more of their income needs during retirement.