Problem: Saving for Retirement

By Ann Levin

A few years ago, Deborah Waite, of Clifton Springs, wasn’t overly concerned about retirement. She and her husband both had good jobs in upstate New York, saved through his 401(k) and looked forward to traveling. Then, within a couple of years, their marriage fell apart, and Waite fractured her pelvis in a zip line accident.

“Now I’m not sure I’m going to retire and have enough money to live like I want to,” said Waite, 55, who was born near the end of the baby boom generation (1946-64) and hopes to retire at 67.

She isn’t alone. According to a recent AARP/Siena College poll, 9 of 10 Gen Xers (born 1965-80) and boomers across New York say that saving enough for retirement is a significant problem.

The telephone survey of 806 New Yorkers ages 35 to 70 also found that 54 percent of Gen Xers and 46 percent of boomers are either just getting by or finding it difficult to manage financially, with only 1 in 5 in each generation living comfortably.

Of those surveyed who say they are struggling economically, about half describe themselves as middle class (having income between $40,000 and $120,000).

Utilities are one of six common household expenses—along with housing, health insurance, medical expenses, transportation and food—that are having a serious financial impact on almost half of both generations, the survey found. In addition, 3 of 5 often worry about having enough money to maintain their standard of living in retirement.

Woefully unprepared
Yet neither generation is well prepared for retirement. More than half haven’t researched their Medicare benefits (64 percent); developed a budget for their retirement (77 percent); made a plan if they become sick, disabled or unable to care for themselves (62 percent); worked with a professional planner on retirement issues (70 percent); or bought long-term care insurance (81 percent).

About 90 percent expect they’ll need at least $2,000 a month in retirement, yet the average monthly Social Security payment for retirees in New York is about $1,400.

At 45, Tashon Davis, a court officer in the Bronx, is looking ahead to retirement. Through automatic payroll deductions, she contributes to both a deferred compensation plan and a 401(k). But like nearly half of middle-class Gen Xers, she expects to leave New York. “I should have enough to live on when I retire, but not enough to live here,” said Davis, a single mother of four, including twin 8-year-old girls.

Statewide, the survey found that women are more likely than men to worry often about having enough money to retire at the age they choose and with the lifestyle they expect. They also are more likely than men to report that housing is having a serious impact on their finances. And Gen X women, in particular, are harder hit than men their age by medical, food and utility costs.

“Unfortunately, women worry more about having the money to retire comfortably and feel less prepared to do so than men. Women don’t get equal pay for equal work, so they feel a tighter squeeze in affording basic necessities such as housing, food, medicine and utilities,” said Beth Finkel, AARP New York state director.

“That makes saving for retirement all the more important for women. But fewer companies are offering retirement plans, making it harder for women to catch up,” Finkel said. “Women especially need an effective way to save their own money for their own futures.”

That’s why AARP New York supports efforts to create a state-administered retirement savings program for workers at private-sector firms and non­profits that don’t offer a plan, Finkel said.

AARP offers financial workshops for consumers, and its website features a Smart Money Resources section (aarp.org/money) that includes a mortgage payoff calculator and other interactive tools to help people plan for retirement.

Since her 2014 divorce, Waite has had a sort of financial awakening. “If I was to get married tomorrow, I would probably keep my money separate,” she said. “Women should have savings equal to men—because you never know.”

Ann Levin is a freelance writer and editor in New York City.