Older Americans increasingly struggling to save for retirement

For millions of Americans, saving enough for retirement is one of their biggest challenges, especially as recent Wall Street losses have led to shrinking 401(k) plans. 

Senior planning executive Daniel Fitzpatrick’s original goal was to retire at 60. He’s now 64 and still working. Fitzpatrick currently has an income in the low six-figures.

“The benchmarks move as I get older,” Fitzpatrick said. Now, his goal is to retire at 70 and then “look for something part-time afterward.”

The national average for one person to live comfortably in retirement is around $967,000 in savings, according to the Federal Reserve. Every retirement scenario is different, but that’s about $74,000 a year for the average American to live through retirement. 

The most expensive state to retire in is Hawaii, with Americans needing to save around $1.7 million. The most affordable is Kansas, at $753,000 in savings needed.

But the typical retirement account balance in only $144,000, according to the federal reserve. 

Rohan Ganduri, a finance professor at Emory University, warns that Social Security won’t be enough for most people. 

“The average Social Security benefits that people draw are about $20,000 a year,” he said. “If you’re relying on just Social Security, it will be very difficult to make ends meet.”

Yet 40% of retirees say Social Security is their only source of income. 

Waiting to retire at 70 maximizes Social Security’s monthly benefits, which could prove helpful in alleviating the financial challenges for aging retirees.

“The biggest expense that goes up are medical costs,” Ganduri said.

Georgia residents, like Fitzpatrick, need about $850,000 to retire, according to GoBankingRates. He has about that much in savings, but regrets starting to save so late.

“If I had to retire and had to live on what I have now, I’d be much more worried,” Fitzpatrick said. 

Fitzpatrick is on track to save enough, but in millions of older households, retirement is becoming increasingly unaffordable.

Mark Strassmann

Mark Strassmann has been a CBS News correspondent since January 2001 and is based in the Atlanta bureau.