You're probably well aware of studies showing that many retirees have amassed inadequate savings, but you might not know that many also are saddled with big debt loads.
As of 2010, U.S. households enduring the highest levels of debt were those whose heads were aged 55 to 64, according to the
Employee Benefit Research Institute. They had average debt of $107,060.
That's obviously a major problem. In addition to harming retirees' financial health, it also can affect their mental and physical health.
"Large debts which are hard to imagine paying off directly contribute to symptoms of depression and chronic stress, both of which may lead to poorer physical and psychological outcomes," Janet Taylor, a psychiatrist and consultant for AARP, told
USA Today.
"The stress of debt can worsen every chronic medical illness."
So how can you cope with a big debt load?
"Start with credit cards," Melissa Richey, vice president of Fragasso Financial Advisors, told USA Today. "Pay more than the minimum amount. That [debt] does nothing for you. You don't get a tax deduction and the interest rates are high. Then consider paying down your mortgage."
"More retirees have debt than 20 years ago," Jamie Hopkins, associate director at the American College in New York, noted. "Having debt is not necessarily a bad thing — it's just if you're prepared for the expense, if you have enough income. Debt in itself is not a bad thing, but not being able to meet your debt and the other life issues is. You need to plan for that challenge."
Meanwhile, there's bad news in a new retirement survey of 2,004 individuals (1,003 workers and 1,001 retirees) age 25 or older from the
Employee Benefit Research Institute and Greenwald & Associates.
The report shows that only 67 percent of American workers or their spouse have saved money for retirement. That's far below the 75 percent figure of 2009, though it's consistent with levels reported since then. Even among workers employed full time, 22 percent haven't saved for retirement.
A total of 61 percent of workers say they or their spouse is currently saving for retirement, up from 57 percent in 2013 and 2014, but down from 65 percent in 2009.
A total of 57 percent of the workers say the value of their household savings and investments, excluding their primary home and defined benefit plans, is less than $25,000. And 28 percent report that it's less than $1,000.
Some of the blame apparently lies with us: 69 percent say they are making enough money to save $25 a week more than they are now, up from 62 percent in 2011. That includes 55 percent who haven't saved anything for retirement.
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