What Is the Average Retirement Income 2017?
For the average American, retirement income translates to Social Security payments. According to 2010 census data, Social Security payments made up 37% of the average retirement income that everyone received. For those in the poorest income demographics, Social Security made up 84% of their total monthly income.
What is the average monthly benefit of retired workers in the United States? $1,294. That means the average retirement income in the US is just $15k per year. Is that enough money for you to live on right now?
For most people who are thinking about retirement, the answer is a resounding “no.” You can’t just retire on Social Security today and have a comfortable life. You need to have other income coming in. That’s why you need to take advantage of these investment options now so that your average retirement income amount can get a strong boost.
#1. Start up an IRA if you haven’t already. If you are above the age of 55, you can contribute more than younger workers toward your retirement and even have those contributions be tax deferred. You can also have multiple retirement accounts, such as a 401k, receiving contributions as well. Even if you are self-employed, you can begin a new retirement account and begin an aggressive investing strategy. Roth IRAs have post-tax money that is invested and can be withdrawn tax free at retirement age, so if your income qualifies, get some money in there.
#2. Purchase tangible assets. If you already have a retirement account that is going strong, consider adding some tangible assets to your portfolio. You can purchase silver and gold bullion coins near spot prices, invest in US government backed gold and silver coins, or consider other precious metals like platinum.
#3. Start saving right now. One of the most overlooked costs of retirement is healthcare. The average person above the age of 65 will incur a minimum of $220k in health care costs over their retirement and those costs are going to increase in the coming years. Medicare isn’t going to cover everything. 60% of American workers don’t even have $25k in savings for their retirement right now. That means today is the day to begin saving.
#4. Using high dividend yield stock DRIPs. If you can reinvest dividends into new investments from high yield dividend stocks, then you can quickly shore up some of your needed income. There are a number of American companies that have increased their dividends annually for more than 30 years, so they are a pretty solid bet for an investment. Even if you only have $3,000 to invest right now, that’s money that could grow into millions if you have enough time to build up a good drip.
#5. Max out your 401k. Most IRAs have a $5,500 cap on contributions, though older workers can contribute more. On the other hand, a 401k has a $17,500 cap. Max out the amounts that you can contribute and then use smart investing to make sure that your income can continue to grow.
The average retirement income that households need today is generally double what Social Security can provide. Use these tips to grow your income and you’ll be able to retire in style.