According to BenefitsPro, at least one-third of Americans don’t feel it is in their future to retire.
BenefitsPro cites a study by Harris Interactive, saying:
Nearly one-third of U.S. adults who would like to retire are unsure if they will be able to or don’t believe they will ever be able to, according to a new survey. The survey also found that only 19 percent believed they would be able to retire at age 65.
The survey also found that young adults have an “unrealistic perception of how much money they need to retire,” according to Rich Rausser, senior vice president of client services at Pentegra. Adults ages 35 to 54 (27 percent) are more likely than those ages 18 to 34 (18 percent) to say they will need more than $1 million to retire. Those ages 18 to 34 (62 percent) are more likely than those ages 35 to 54 (45 percent) to think they will only need up to $500,000 to retire.
So what is the answer? If you’re thinking life insurance payments may help fund your retirement, that strategy may be flawed. Here is a look at why from the Wall Street Journal.
For decades, salesmen have encouraged people nearing retirement to elect to take their monthly pension as a larger amount that will end at their death, instead of accepting a smaller monthly pension with payouts that will continue over the life of a spouse.
Supposedly, the additional pension a person receives each month can be used to buy life insurance to protect the surviving spouse.
This isn’t as simple as it sounds. To make it work, you will need to estimate the value of the pension payments the survivor will forfeit, and buy enough life insurance to replace that.
In addition to the higher costs, this strategy puts your spouse at risk. Agents show illustrations of how much your cash value will grow to over the years. But if the illustration is overly rosy and actual growth is lower, you may be forced to contribute higher premiums in subsequent years, which can be a challenge on a fixed income.
If you don’t pay the premiums, your policy could lapse, and your spouse will end up with neither life insurance nor a pension when you die. A persistent misconception about life insurance is that one can get something for nothing. This is rarely the case, and even less likely when you are older.