Research shows lack of savings could lead to poverty by retirement

Research shows lack of savings could lead to poverty by retirement

(WWBT/WXIX) - Many American families live paycheck to paycheck with nothing left over for savings.

Now a new study makes it clear that a lot of people now in their 30s or 40s will still barely be scraping by in what they’d hoped would be their “golden years.”

New data from the Schwartz Center for Economic Policy Analysis finds that about 40 percent of middle-class Americans will live in poverty - or close to it - by the time they’re 65.

The main reason? They’re not saving for retirement, which means they’ll have to rely on Social Security.

The most common age for retirement in America is 62. If you start claiming Social Security at 62, you’ll only get 70 percent of your benefit. Start taking those benefits at age 65, and you’ll get 86.7 percent.

Only people who wait until 67 or later to claim get that full 100 percent of their benefits. Those checks aren’t huge: the average monthly Social Security check is about $1,400.

And if Social Security is slashed 21 percent in 2034, as the federal government has warned, that check will be even smaller.

Copyright 2019 WWBT/WXIX. All rights reserved.