The sluggish economy has forced 25% of those 45 and older to take money out of their retirement accounts to get by now, according to AARP, which did a phone survey of 1,002 older Americans.
Another 27% said they have postponed plans to retire due to the recent economic downturn.
The numbers could be translated to say 1 in 4 people are going to have a lower standard of living in retirement. Taking money out of 401(k)s and IRAs now weakens the tax-deferred or tax-free growth needed to fund retirement activities that come with the “renaissance.” Often, the decision is short-sighted and made without regard to the future. For example, has spending been cut or are those withdrawals being taken to maintain past spending levels? Working with a financial planner can often prevent the invasion and instead build a better financial future.
