NORTHAMPTON, Mass. (WWLP) - A new report says more seniors are at risk for running out of money during their retirement years.
Researchers found Massachusetts seniors live on less than half their pre-retirement income, and more retirees are living off their Social Security benefits.
Whether you're young. "As soon as I started work, 23, I started a 401K; with 15% of my salary put into it," said 29-year-old Brian Darnold of South Hadley.
Or if you are old. "I've been saving right along. Sometimes are better than others. There's other times, like the winter, when the heat's up and all of that, it's not so easy to do," said Dave Poulin of Easthampton. Poulin is semi-reitred and works 25 hours a week.
Building a nest egg is on the minds of many, but an interest-rate tracking website says Massachusetts seniors don't have enough saved and are only living on 45% of their income pre-retirement. 40-year-old Gregory Williams of Holyoke works in retail and says he doesn't see himself retiring for a while.
"People that are making more money than someone in retail or other professions like that, that are entry level. If they are having a tough time getting by on that, someone like me [is] definitely worried about that," said Williams.
So how do you plan ahead? UMass Five Credit Union's Jon Reske says when it comes to saving, time is more valuable than money.
"You have two individuals, one who's age 25 and who's age 35. You put down $100 and then put away $25 a week until retirement. The individual who started at 35 will make about $98,000. The person who started at 25 will make $188,000. That person who made $188,000, only $13,000 was additional money they put in. The rest was interest," said VP of Marketing Jon Reske inside the credit union's Hadley branch.
Reske says if you start to save early and do it systematically, like every week, you'll be better off.
He added that when figuring out how much you should save, going by the "Rule of 72" is a good start. For example, if you want to know how long it will take to double your money at 12% interest, divide 12 into 72 and you get six years.