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The purpose of this post is simply to illustrate that the world of retirement planning and living is vastly different than that of many, if not most, in the HumbleDollar community of writers and readers. No judgement intended.
While we debate, saving, budgets, annuities, investment and withdrawal strategies, the real world, doesn’t or can’t save or invest adequately let alone accumulate wealth.
According to the Federal Reserve, the median retirement savings for individuals age 55-64 is $185,000 and the average $537,560. It is only slightly higher for those 65-74.
We discuss on HD how to use the 4% or other withdrawal strategies, but for most retirees it doesn’t matter much – because 4% of $185,000 is $616 per month possible income. Plus Social Security provides a big chunk, if not most of their income.
The median net worth for those 65-74 years old is about $410,000 and $334,700 for those 75 and older. Given that includes their home and all assets, most seniors have little flexibility to work with – including emergency savings.
According to the Pension Rights Center the median income of individuals age 65 and older is about $29,740 and for households $50,290 which of course, means half have lower incomes.
The SSA reports as of August 2025, the average benefit for “retired workers” is $2,008.31, no median is available, but it is less for sure.
For approximately 39% of men and 44% of women who are Social Security beneficiaries aged 65 and older, the benefits represent 50% or more of their total income. For about 12% of men and 15% of women in the same group, Social Security accounts for 90% or more of their income.
I don’t know about you, but these sobering numbers raise a feeling of guilt. My property taxes and HOA fee are nearly equal to the median retiree income. While most retirees rely heavily on Social Security, we are busy planning how to give our RMD to charity, children and grandchildren.
I can make the case we earned what we have and were prudent with money for 56 years, but so did others and we can’t discount our tremendous good fortune and absence of misfortune.
RQ
thnx for another informative article
I have been lucky in life by being able to save and spend at the same time so the averages have no meaning to me. I also take SS and 100% P&T from the VA with that there is no need to take any money from our Roth and other Mutual Fund which we use for our Emergency Fund. We are lucky to live in a country that treats us fairly
Keep up the good work to make people think……Right or Wrong
This is an interesting topic. There are some who think society should operate so that outcomes for its members are equal, while others think that only opportunities can be equal. I am not sure about either.
At 79, (1946) only about 35% of my birth year cohorts are still living. The amount of my assets is larger than it was 9 years ago at age 70. How much of the length of my life is due to my genes, how much to choices I made as I grew older, and how much was chance or fate?
As a man, I benefited from the higher wages paid to men during much of my working life. In 1972 when I started working for the insurance company where I worked for 30 years, there were no female employees except those employed in clerical jobs.
For men, those who are married and stay married to only one spouse live longer and are wealthier than those who do not.
Before AI, one could expect to earn more with a college degree than without one. And, in the mid-1960’s, a top public university charged less than $1000 for four years of tuition.
Finally, both my spouse and I are children of parents who grew up and were significantly affected by the Depression. Being thrifty is a lot of who we were programmed to be.
Okay, so we are wealthy. It isn’t totally our fault, Nor, is it totally a demonstration of our virtues. All that we can do is to play the cards we still have in our hand.
Your essay points out something important. Retirement savings makes a difference and the less one has, the more important each and every saved dollar becomes. The $616 additional income you cited may be a lot of money if one lives primarily on social security retirement benefits. Every dollar was saved as a conscious act, and it made a difference.
We each live in the real word, but our bubbles are different. There are many reasons why we are each in our own personal financial situation. While our actions and inactions certainly contributed, there is a factor we might call “good fortune” or providence. We are each blessed.
Some of us have spent time bouncing along the bottom and I was one of those. At the age of 49 my “net worth” was $10,727 and decreasing. I was broke and with overwhelming financial obligations. The children were living in college and that is where the funds went. Cash flow was negative. Discretionary spending and junk food took on a new meaning. My monthly discretionary spending was $0 and my food budget $25. This meant there were no funds to pay for such as potato chips, cookies, soda or juice. I relocated and was living in a $670 a month apartment. There was no air conditioning. When some of my neighbors decided to go to a movie to cool off, I didn’t because I could not afford it. There were no funds for true essentials such as medical, dental or eyeglasses. When the frame broke, I taped and glued it. There was no retirement savings plan. That’s the way it was. When my future spouse met me, she thought I was an odd, but interesting duck.
Over a period of three years my net worth bottomed at $848. Bankruptcy was an option I didn’t take. I had my spreadsheets and a plan. I chose the more difficult path. After six years of this, at the age of 55 I had finally dug my way out of that particular financial hole. My cash flow improved and became positive. I upgraded to a $700 a month apartment. It was time to save for retirement, yet again. Throughout all of this I did have a career and worked the equivalent of two jobs. I sometimes worked for 32 days continuously at 12 hours per day, with time off to sleep, eat and do laundry. There were evening business meetings, too. With the completion of one project the cycle began again. I had put “volunteering” aside. That was for those with resources I did not have. I think I built two lives with the equivalent of two financial lifespans. The first began at age 17, the second at age 53.
I’ve never had guilt about my personal situations, but there was a price to pay beyond the financial. There are always decisions to be made about how to spend the time and resources we have been given. This may be difficult or uncomfortable. For some the situation occurs as an abundance. For others, it will never be enough. When my spouse and I were dating as adults and I had a couple of spare dollars we would go to Dunkin Donuts, purchase a small tea, a small coffee with donut combo, and split the donut. We each decided we had an abundance, even if it was only that half a donut. The joy of sharing made up for the missing calories. Every crumb was delicious.
I consider myself to be extremely fortunate. It was difficult to be positive in the darkest days. I was once asked how I managed. When I was exhausted, I would tell myself “I’ll sleep tomorrow.” Sometimes that tomorrow and a good night’s rest was a few days away. Metaphorically speaking, if I couldn’t run, I walked. The point was to never stop and to keep moving toward the goals. If there were breakdowns I shifted. In sailing “tacking” is a method to sail against the wind. This is possible in many aspects of life. Eventually the future will become today. We can plan and prepare for it. Or not.
As someone with one foot in the grave I can honestly say I could have done better and been better. My doctors have told me that my life’s experiences, including dealing with a lot of adversity strengthened me in many ways and that is one of the reasons I am amazingly, impossibly, alive today. For a little while longer, anyway. While I do have regrets, I don’t have guilt. That’s a luxury I prefer to leave for others.