1. You'll probably need long-term care (and have to pay for it)
According to the U.S. Department of Health and Human Services, 70% of people who live past 65 will need long-term care. If you're married, there's a 90% likelihood either you or your spouse will need long-term care. In other words, if you live to retirement age, the odds are good that you'll end up needing some sort of long-term care.
And since long-term care is not always covered by health insurance or Medicare, retirees need to have a plan to provide for it. Here is how the majority of non-medical long-term care -- what Medicare doesn't pay for -- is provided for:
Long-term care insurance
Increased retirement savings to cover this cost
Unpaid care provided by family members (usually a spouse or adult children)
2. Social Security Full Retirement Age will increase soon
Full Retirement Age -- that is, the age you qualify to receive 100% of your Social Security retirement benefit -- is 66 for retirees in 2016, and is set to remain age 66 through 2020. But for a six-year period starting in 2021, Full Retirement Age will be pushed by two months -- meaning 66 and 2 months for those born in 1955, 66 and 4 months for those born in 1956, etc., until the full retirement age reaches 67 in 2027.
In other words, anyone born after 1954 will either have to delay retiring a little longer to get their full benefit, or elect to get a smaller check each month if they retire at 66 or sooner. If you're planning to retire anytime between now and 2027, it's a good idea to make sure you know when your Full Retirement Age is, since the amount of your monthly benefit is predicated on that number.
3. Average retirement savings will generate less than $500 per month
According to Vanguard, which manages millions of retirement savings accounts, the median balance in defined contribution plans (think 401(k) plans) it manages for people 55 and over was less than $72,000 in 2015. For context, that would only generate about $240 per month in retirement income. This only covers a small selection of total retirement savings, but even as a small sample size it's concerning.
The U.S. Government Accountability Office offers up a bigger picture look, but it's still concerning. According to the GAO, the median age 55-64 household has $104,000 in retirement savings, while the median age 65-74 household has $148,000 saved. Sure, that's a lot more than Vanguard's data, but in terms of dependable retirement income, it's only worth $347 to $493 per month in retirement income. Paired with an average Social Security benefit of less than $1,500 per month, that's not a lot of money to live on in retirement.
For millions of older Americans, there's an even bigger concern. The GAO found that 29% of households age 55 and over don't have any defined benefit (such as a pension) or retirement savings at all.
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