In America, the Average Retirement Income of a retiree is $48,000 yearly before the tax cuts. An average retiree spends max $46,000 every year. As the Bureau of Labor Statistics measures, this income and the outflow is part of older households. Older households mean where people of 65 years or older live. However, the annual pre-tax income of all households of the U.S. is almost about $74,000 while the average expenditure rate is $57,000.
The questions rises, who are signing the monthly average paychecks worth $4,000 of the retirees? Though, those who are toiling in their 9-5 job depends on the work wages. Let’s search for the answer to your $48,000 question.
Retirement Income: Allowance
Social Security is the biggest income source for American retirees. In 2018, benefits of $1 trillion had reached to the retirees. Social Security Administration disclosed the data. A retired worker gets average monthly benefits of Social Security at least $1,412 or around $17,000 a year.
Income from the government and private pensions and Social Security provide nearly half of the income during retirement every year to an average older household of America. According to BLS data, the second-biggest lot of income during that period is $3,300 annually. It comes from rentals received dividends from various investments and savings interest as well as rentals from other property.
Multiple Average Retirement Income Streams
Do you think that your inheritance will rain when you reach your retirement age? Then it is best that you have a backup plan. The Studies and Harris Poll of Transamerica Center for Retirement surveyed at least 2,012 retirees. Among them, only 1% said that this inheritance was their primary source of income after retirement.
Social Security will still write up checks, even if they may pay less to future generations. But if there is no pension plan to cover up your retirement income source, then you can fall in trouble during your retirement. The IRAs and 401(k)s will play an important role in the average retirement income source.
Give The Raise
If you have fear about having enough money for your retirement days, then you can do many things before those days arrive. You can also plan something during your retirement time to boost income.
1. Supersizing Social Security Check
If you don’t touch the monthly benefits of your Social Security income till you become 67 years old (the age for full retirement), you can reap plenty of benefits. After your retirement uses other income sources for some years. Your monthly benefits from Social Security will go up at least 8% annually.
2. Give The Savings A Bonus
IRS is giving a birthday present to those who are 50 and older. It allows them to invest more money on tax-saving accounts. In the employer-sponsored retirement plan like the 401(k) or the 403, (b) the limit of annual contribution boosts to $24,500 from $18,500. You can add $1,000 more in your account over the $5,500 annual ceiling, in an IRA.
3. Get Creative
Doing a part-time job or renting a part of your home can multiply your fixed income. On the other hand, if you are downsizing your cost of living, each saved dollar can make more money.