When Jim was laid off from his supply chain management job at the age of 55, he only had about $15,000 in liquid savings to survive an extended period of unemployment. With a monthly expense bill of $2,500 to pay for a mortgage, food, transportation, and medicine for his arthritis, Jim has six months left before the lights go out.
After almost 30 years of work, why didn’t Jim save more? “Well, for one thing, I never expected to be unemployed at age 55. Globalization is making job security harder to come by. I was also a believer in Social Security, although now it seems like the government has no choice but to raise the collection age. 25 years ago, nobody ever thought we’d have such a huge budget deficit in America,” Jim responded.1
It turns out that Jim is not alone in his dire savings situation. A 50th percentile person between the ages of 45-54 has an average household net worth of only $84,542 according to the US Census Bureau.2 With a modest household annual expense rate of $30,000 a year, it’s no wonder why there’s so much retirement angst among the middle class.
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