Americans Aren't Coming Close to Maxing Out Their Retirement Plans, Data Shows

Though Social Security helps seniors stay afloat financially by providing some income for them, it's not enough to live on by itself. The average recipient today collects less than $18,000 in annual income, and while most seniors need roughly 70% to 80% of their former earnings to live comfortably during retirement, Social Security only provides about half that sum for a typical worker. That's why independent retirement savings are a must, whether in an IRA, a 401(k), or both.

But new data from GOBankingRates reveals that Americans aren't saving enough for their golden years. Currently, IRAs max out at $6,000 a year for workers under 50, and $7,000 a year for those 50 and older. Meanwhile, 401(k) contribution limits max out at $19,000 a year for workers under 50, and $25,000 a year for the 50-and-over set -- and, they're going up in 2020. Yet the typical worker's annual retirement contribution today doesn't even hit the halfway point on the IRA limit. And that means today's savers need to do better.

IMAGE SOURCE: GETTY IMAGES.

Continue reading

Source Fool.com