A whopping 46% of Americans believe that they are going to retire in the red is the startling find of a recent survey from MagnifyMoney that could have long-term implications for fixed income needs.
In retirement, monthly payments for various debts can very quickly eat into monthly income allotments and can add up rapidly to a financially overwhelming situation for a retiree. With 43% of people responding that they believe that their Social Security will run out and disrupt their retirement plans, it can all add up to a dire situation.
“Debt can derail a lot of folks’ retirement plans,” said Ismat Mangla, MagnifyMoney’s executive editor, as reported by CNBC.
Image source: CNBC
The debt burden for Americans over the age of 70 has skyrocketed, rising 614% from 1999 to this year, hitting $1.27 trillion, reported by the Federal Reserve Bank of New York. While carrying over some small debts into retirement is generally considered okay, as is the acquiring new debts with low interest rates like cars or mortgages, piling up bills from credit cards and variable rate sources can quickly add up to problems.
Having a realistic plan and expectations that take into account sources of added debt in retirement is a big step towards planning for realistic retirement goals. Monthly payouts should cover all debts owed and living expenses and still leave room to live comfortably.
For those planning retirement needs with high levels of debt, solutions might fall to working for longer to continue to bring in reliable income, or else supplementing monthly income from retirement with a part-time job, suggested Ann Eweka, senior director of financial planning strategy at TIAA. The best way to assess what your retirement needs are is to partner with a knowledgeable financial advisor.
Nationwide offers a variety of retirement solutions and resources for individuals and investors. The firm currently offers four ETFs with different investment strategies depending on the desired outcome and goals of the investor. As a Fortune 100 company, Nationwide is one of the biggest diversified financial services and insurance organizations and offers a depth of experience within its Investment Management Group (IMG), which oversees sub-advisors of funds and manages assets.
For more news, information, and strategy, visit the Retirement Income Channel.