Retirement

Retirement is when a person chooses to leave the workforce. The concept of full retirement – being able to permanently leave the workforce later in life – is relatively new, and for the most part only culturally widespread in first-world countries. Many developed countries have some type of national pension or benefits system (i.e. the United States' Social Security system) to help supplement retirees' incomes.

Dramatic advances in healthcare have extended the lives of people in, predominantly, first-world and developed countries. That means that without adequate personal savings and/or pensions, people could easily outlive their retirement funds. In times of economic downturn retirees may choose to "come out of retirement" and re-enter the workforce on a seasonal, part-time or full-time basis to earn income and obtain benefits, especially costly health insurance coverage.

Here's what the U.S. Census Bureau knows about retirement from its surveys: The average American retires at age 62;  20.7% of the
population will be 65 years or older by 2050; the average length of retirement is 18 years; nearly half of retirees leave the workforce earlier than planned, sometimes involuntarily (41% retired due to health problems or disability, and another 14%, to provide care for a spouse or other family member).

Although Americans have professed the intention to work longer, many must do so out of economic need.  The Economic Policy Institute notes that the mean retirement savings of all working-age families is $95,776, but the median, which takes into account the nearly half of those who have no retirement savings, is just $5,000.

Here are some tips on how to save for retirement: Any savings is savings, and saving even relatively small amounts of money establishes the habit and the process. Many brokerages now offer no-minimum, no-fee retirement accounts and you can get $25 or $50 deducted from your account every month and sent into that retirement account.

It really is important to look at retirement saving as a non-stop, life-long habit. It can be tricky to scrape together the cash to make a contribution to an IRA in April, so don't set yourself up for failure. Save a little each month, ideally using an online savings account and only tapping into it in extreme emergencies. Most of these online accounts will allow you to automatically deduct a set amount every month from your regular account, and if your employer offers a 401(k) program, you will be able to have deductions made automatically from every paycheck and possibly have your employer match some part of those contributions.