Retirement has been a hot topic lately as Americans navigate economic uncertainty and increasing inflation. The average retirement age has already increased over the past three decades. The current economic landscape has created one more hurdle to planning a financially secure future. Each generation faces different hurdles associated with financial security, so let’s explore 2023 retirement trends and how they can aid each generation.
2023 Retirement Trends
Working Later in Life
Over the past three decades, the average retirement age has risen from 57 to 61 for a few main reasons: the need for more income, to avoid tapping into social security income, a shift from pensions to 401(k) plans, and more. In today’s economy, we add additional complexities: inflation and a volatile market. Working longer and later into life has become a common trend in 2023 as many avoid drawing on retirement too early.
Part Time Jobs
Another 2023 retirement trend is the rise in acquiring part time jobs. Some Americans are taking on part time jobs to cover extra costs, while others are taking on more part time work in retirement. A recent survey by BlackRock states 64% of retirement savers are concerned about outliving their retirement income. Part time jobs can be a tool to help retirees require less from their retirement savings.
Investing & Acquiring Assets
It is as important as ever to plan for a financially secure retirement. Savers are taking a look at the best ways to invest their income. Reevaluating investments has become more common in 2023 and BlackRock suggests savers are considering new investment formats to find more security and consistency.
In 2023, younger generations have the power of time on their side while older generations have the perk of adjusted 401(k) and IRA limits to make the most of their contributions. Whether you are a seasoned investor or just starting out, Bankers Life Securities is here to help evaluate and grow investments.
Now that we have covered some retirement trends of 2023, let’s explore how they can be beneficial to each generation.
Reevaluating Retirement by Age
Millennial (Ages 28 – 46)
Millennials face a big challenge when it comes to freeing up income for investing: debt. According to the SOA Research Institute, 48% of millennials feel their level of debt is complicating their ability to manage their finances. Investing some time into debt payoff methods could help get the ball rolling on investment opportunities. Using part time jobs or side hustles to help knock out debt quickly could also help open up income for retirement.
Generation X (Ages 47 – 58)
Generation X struggles with feeling like they are on track for retirement, according to the SOA Research Institute. Only 54% feel on track in planning for a financially secure retirement and 57% feel their finances are under control. Since the youngest member of this generation is about 10 years out from retirement, revisiting investment strategy would be beneficial. Partnering with an investment professional could help boost investments and assets in the home stretch before taking the plunge into retirement.
Baby Boomer (Ages 59 – 77)
Although inflation has caused some challenges with investing, 2023 has also presented some positives in the investment arena. Higher 401(k) and IRA contribution limits were put in place by the IRS at the beginning of the year, including additional catch-up contribution opportunities. Baby Boomers planning for retirement could consider taking advantage of these higher limits to maximize their investments.
Bankers Life Can Help
Having a financial professional in your corner during uncertain economic times can only make your investment portfolio stronger. Bankers Life can help guide you through retirement and investment options. Call us at (844) 553-9083 or click here to get started.
