Financial advisors generally hold that retirees need about 70% of the annual income they earned during their working years. That’s combining payments from Social Security, pensions, and savings.
Mike Sante, managing editor of Interest.com, says that on average, American seniors are retiring on only 57% of their pre-retirement income. He says Texas retirees are doing better than the national average, but only just.
“In Texas, for example, the median income for the pre-retirement cohort, households 45 to 64, is right at $60,000 a year. Once you get 65 and older, the median household income drops to $35,000.”
What makes the situation worse, Sante says, is that more and more people are retiring without owning their own homes. He says rent or mortgage payments can easily shave another third off seniors’ already inadequate incomes.