Unprepared For Retirement

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Whether you like it or not.

Whether you’re prepared or not.

The reality is that someday, you will retire.

Are you ready?

Type “Unprepared For Retirement” into Google, and you’ll find 995,000 results.  With today’s post focusing on that topic, I guess there’ll be 995,001 results by the time you read this.

Why is “Unprepared For Retirement” such a popular topic?

I suspect many folks are worried that they’re, well, unprepared for retirement.  Having just retired myself, and being hyper-focused on retirement preparation over the past 5 years, I can relate to folks worrying about whether or not they’re prepared.  I’ve had the same doubts myself.

Unprepared For Retirement

Retirement is a fascinating, and scary, topic.  It’s a period in life where WE are responsible to ensure we’re ready.  And yet, the resources available to help you prepare seem insufficient to give you the confidence that you are, indeed, ready.  Worse, there are millions of folks out there on the cusp of retirement who seem to lack a basic understanding of the reality that there’s a cliff in front of them.

A Cliff In Front Of Them.

Imagine walking along a mountain path.  You’re enjoying the scenery, but you’re oblivious to what’s ahead.  If you knew there was a cliff around the next bend, wouldn’t you want someone to warn you?

Now, think of all of those folks in our world who are walking in oblivion toward their personal cliff of retirement.  A huge change in the landscape, just up ahead around the next bend.

It’s Time To Warn Them.

Too many folks are unprepared for retirement. Today, 5 Steps to help you prepare. Click To Tweet

I worry (a lot) about the number of folks who seem to be unaware about their need for retirement planning.  Perhaps they’re aware, but they’re not taking the steps to prepare themselves.  I struggle with how best to reach these folks.  Unlike you, they’re not reading a retirement blog.  Perhaps, somehow, a few of them will read this one, and begin taking seriously their responsibility to prepare for what’s around the next bend.

Side Note:  Do Me A Favor?

It’s a concerning reality that the folks who most need to read about retirement planning are the folks LEAST likely to read this post.  So, do me a favor?  Think of 1-2 folks you know who are over the age of 45, but not taking the time to read up on the steps they should be taking for their inevitable retirement.  Then, send them a link to this post.  Bold, I know.  But I really want to try to make an impact in the lives of people who need it the most.

Together, let’s try to help a few more folks Achieve A Great Retirement.  Are you up for the challenge?

How Many Folks Are Unprepared For Retirement?

47% of folks are confident in their retirement prospects, up from 32% last year, according to this AllianceBernstein study.  More concerning are the 17% of respondents who say they have not thought about retirement or never plan to retire.  Assuming that same 17% ratio applies to the 76MM Baby Boomers, that equates to 13 Million Baby Boomers who are Unprepared For Retirement!

13 Million Baby Boomers Are Unprepared For Retirement. Here are 5 Steps to help them prepare... Click To Tweet

Like it or not, retirement is coming.

It’s best to prepare.

Following are 5 Steps that those who are unprepared for retirement should consider taking:

5 Steps To Prepare For Retirement

1. Realize That Retirement Is Coming, Probably Sooner Than You Think

Many folks believe retirement won’t be an issue.  “If I don’t have enough money, I’ll just continue to work”, seems a common phrase for those Unprepared For Retirement.  Unfortunately, the facts don’t support that strategy.

Most folks retire sooner than they think they will.

In fact, close to 50% of folks retire earlier than planned, according to this EBRI survey, as summarized in this chart from their survey (yellow highlight added by me):

These findings are consistent with the research I summarized in Will You Be Forced To Retire Early?, where I found that the majority of folks retired earlier than they had planned.

2.  Start Building Your Retirement Savings

According to a recent Personal Capital Survey, 32% of Baby Boomers, 34% of Gen Xers and 39% of Millennials say they have no money at all saved for retirement.

A third of Baby Boomers and GenX'ers have NOTHING saved for retirement. Unprepared For Retirement? Today's post is for you. Click To Tweet

If you haven’t started saving for retirement, realize it’s never too late.  For motivation, read the amazing story of one of my reader’s parents, who had nothing saved at Age 49, yet retired comfortably at Age 65:  It’s Never Too Late To Start Saving For Retirement.

Bottom Line:  If you’ve never saved for retirement, the time to start is now.  Make sacrifices now, if necessary.  If you don’t, you’ll likely be forced to make sacrifices later.

3.  Calculate Your Net Worth

Regardless of how well you’ve planned for retirement (or not), everyone should track their Net Worth.  As I explained in How Much Fuel Is In Your Tank, the Net Worth statement simply lists all of your assets, subtracts your liabilities, and shows the resutling “Net Worth”.  Your Net Worth is a foundational piece of information you’ll need to determine how much you can spend in retirement.  Update it annually, and feel the motivation of watching it grow as you increase your savings.

An example of a Net Worth statement from the referenced article is shown below:

To start building your Net Worth, simply copy the Net Worth Template I made for you, and get started.  (Just make sure to go to “File / Make A Copy” to save a copy onto your drive to allow you to make changes).

Alternatively, simply input your information into Personal Capital’s online tool, and it will automatically create a net worth statement for you (note, that’s an affiliate link, and I’ll get a small payment to offset my costs of running this blog if you create an account.  Thanks in advance!)

4. Run A Retirement Calculator (Or Two)

One of the best things you can do as you begin to prepare for retirement is to play around with an online retirement calculator.  These free tools will calculate your retirement readiness, based on your current assets, your projected contributions between now and retirement, and your expected retirement spending.

One of my favorites is Personal Capital (affiliate link), which provides some easy-to-understand graphics and includes a retirement readiness score.  A screenshot example is shown below:

In addition to providing your “retirement readiness” score (99% in the hypothetical example above), Personal Capital allows you to enter “one-off” expenses (e.g., College) and income (e.g., inheritance), which it incorporates into a projected portfolio balance throughout your retirement.  Personal Capital also tracks your net worth automatically and provides some great dashboard overviews of your entire investment portfolio.  If you haven’t checked out Personal Capital yet, I encourage you to do so.

To explore 4 more of my favorite retirement calculators, see my article The Best Retirement Calculators, which provides a summary and screenshots from the best retirement calculators available for free.

5. Begin To Educate Yourself On Personal Finance

Finally, if you’re unprepared for retirement, it’s time to start educating yourself about Personal Finance.  Congratulations for reading this post, you’re showing that you’re willing to learn.  Don’t stop now.  Check out these 10 Retirement Blogs Worth Reading, and pick a few that resonate with you.  Sign up for their e-mail distribution, it’s free and you’ll start getting a regular feed of articles on the topic of retirement planning, direct to your e-mail.

If you feel overwhelmed by the topic, don’t hesitate to hire a professional (try Palladin as a free screening tool to find a Certified Financial Professional near you), but don’t use that as an excuse to not understand the basics.  With or without a professional, no one cares about your money more than you do, so don’t “delegate it and forget it” on your retirement planning.  While you’re at it, please subscribe to The Retirement Manifesto, I’d love to have you on my team!


It’s unfortunate that so many people are unprepared for retirement.  Let’s all do whatever we can to reach a few folks who aren’t aware of the looming cliff of retirement.  Whether we plan for it or not, retirement is an ultimate reality for most of us, and it’s a tough cliff to face unprepared.

What About You?  Do you consider yourself prepared for retirement? What advice do you have for someone who is unprepared for retirement?  What steps have I left out of this article which folks should consider?  What have you found most helpful for your retirement planning?  Let’s chat in the comments.


  1. I’m wondering if the “probably sooner than you think” piece will keep holding true with household debt at record highs and so many people unprepared as you state. Maybe there will be a breaking point when folks start working longer and follow the Suze Orman model.

    Great post!

    1. I hope they have the option to work later, Dave. Many of those who retire earlier than planned do so against their will (either “forced out” or due to health issue). I suspect many folks will have unpleasant retirements, unfortunately.

  2. Very sobering post, my friend. A lot of people are going to work until they die or live a retirement of penury on Social Security. My only advice to people is this: the closer you are to retirement age with no savings, the more radical your retirement planning must be. For example, if you’re 55 with nothing saved and want a decent retirement, you got to be bold. Work until your 67 and save $500 a month in a Roth IRA. That should leave you with $100K when you retire. Next, move to a low-cost state or country and rent a trailer. You should be able to cover your living expenses with your Social Security check. Finally, use the $100K for emergencies and some fun–providing it’s cheap fun. It’s not a dream retirement. But it’s better than working until you croak.

    1. Great advice, Mr. G. I’d be interested in how many folks would actually apply it, likely far fewer than should. I can’t imagine facing the reality of a retirement with nothing saved. When will folks wake up? I suspect many will “work until they croak”, if they’re fortunate enough to keep their jobs.

  3. I not only shared with 10 family/friends over 45 but also with my two sons and several of their cousins who are in their 20’s.

    Those who have hit 40/45 can still make a difference in preparation for retirement with some accelerated changes.

    For those in their 20’s – take some good life lesson notes on the statistics in this post and start making changes to be prepared.

  4. Terrific article Fritz!

    I have about 5 people in mind that I will be sending this to, because it is a message that NEEDS to get out there!

    The worst thing an older person can do is throw in the towel and just give up. Your article explains perfectly why that simply isn’t an option one can take.

  5. Great post as always. One other thing I started doing early was a detailed tracking our expenses. Both to get an accurate assessment of how much you are really spending and to see how each category changed through out the year and over a period of years. It gave us ideas of where we could cut back if needed.
    Thanks for your writing Fritz.

    1. Thanks for your kind words, John. Great idea to track spending, we tracked every penny for 10 months as we were preparing for retirement. It gave us a much more realistic baseline for our planning. Good addition to the discussion!

  6. The biggest thing I am unprepared for in retirement is what I’m going to do about healthcare. I would like to retire at 62 but I won’t get Medicare until 67. My company used to pay for retiree’s healthcare but they ended that a few years ago. It makes me feel anxious. I refuse to work until 67. I have good savings in my 401K and other assets but again, no plan for healthcare.

    1. My understanding is the Medicare age remains at 65. Although Congress has considered changing it to ramp up over a few years to age 67, I don’t believe that effort passed. Yet.

    2. Yup, Medicare begins at 65. Standard retirement age is 67, and often people confuse the two. For many years, both were synced at age 65.

    3. I plan to retire around 62. We will manage our taxable income to stay under the ACA subsidy cliff. We can probably get a Bronze plan with no cost to us.

      It just takes some early planning to have a pile of money that has already been taxed (ROTH conversions before I retire)

  7. My biggest area of concern is on the expenses… I have a very good handle on what the essential expenses are – have been tracking them for a couple of years while attempting to downsize and get them under control. The non-essentials are out of grasp. There are unknowns… like we will need new windows, replace carpeting, upgrade our bath. hoping for these to be inexpensive as possible. then there are trips, planned and unplanned, and I expect more of them in retirement. there will be more recreation in retirement. going out to dinner is one of our fun to do items…. occasional play or concert or sports event. how do you predict those expenses? that question is keeping me working.

  8. I’m fascinated that the percentage of each generation with no money saved for retirement is about the same (30%+) for Boomers as Millenials. This suggests a human condition more than a generational thing. 30% of us are grasshoppers!

  9. Great advice, I really enjoy your post and articles. Many people (the 30%) don’t know or care about saving. That’s just the way it is. I have given up on them but will forward this post anyway. The rest of us who do plan and save do so because it’s just makes sense (like getting out of the rain).
    I started saving with first real job and very glad I did. Dividend reinvestment plans worked for me and after 30 years there is enough lncome for my wife and I to retire.
    Keep up the good work 🙂

  10. I am more concerned about “what to do” than I am about “how to afford it”. Lots of folks are struggling with this, too.

    1. Dear VegabondMD – I hear that from a lot of retiree’s myself as I finish my 3rd year of early retirement however I have found my “Dump Truck” of things to do continues to overflow with amazing adventures. I have found that asking the people I meet while I am out doing the things I love “what are the best places they have seen/ things they have done” always returns with some excellent ideas. You’ll have more places to see and things to do than you ever imagined!! Just keep in shape, its a long journey 🙂

  11. Wow, Fritz, thorough but a great read, as always. I am grateful you are putting this message out there, so many people need to hear it. My wife and I are already slightly early retired and have zero money worries because we started preparing for this in our twenties. But as you point out there are so many people in their forties or older that have not taken one single step. I love the cliff analogy. I fell off a cliff once and it was a miracle I walked away in one piece, I’m afraid a lot of people will not fare that well when they step off a financial cliff.

  12. Thanks for another great article. 22 days from retirement. I shared this with my son and will share with my daughter. Each mid thirties. My daughter and I have started a good dialogue about retiring and planning. She was real curious as to my readiness as I think she was concerned my plan involved moving in with her. This has allowed me to try and share some options with her without seeming like I am preachy or telling her what to do. I feel I am as prepared as I am going to be. I have been planning for many years but relying on my work 401a and pension as well as some 457 $. I was aggressive with the market until 2 years ago and scaled back the risk some. I am applying your 3 bucket strategy now. I started using the NewRetirement calculator about a year or so ago and it has come a long way. I created an expense and income spreadsheet geared to the calculator inputs and that helped a lot. I also did the income the same way. This gives me a check and yearly review. I set aside an expense item for travel and recreation savings fund. I try to track expenses at the necessity level and then have these extra categories that I can adjust as needed. I am also pessimistic and this gives me easy “what if” options. I also spent about a day and went though and documented all my accounts as well as assumptions and why I made them as I did and gave a copy to my wife in case I suddenly wasn’t around. My biggest fear is that I am not around and my wife doesn’t understand what and why certain decisions were made. Great post.

  13. Hey Fritz,

    I loved your remark that the people most likely to need this article are the least likely ones to actually do so. It’s quite true; I’m 31 and no where near that point at the moment where I’m actually considering retirement, but the topic is nevertheless in my mind as I am a long-term planner by nature.
    I think one of the key things for people to keep in mind is that they need to be cash-flow oriented and understand what their true monthly costs will work themselves out to.
    Thanks for the interesting read.

    Take care,

  14. re Let’s chat in the comments – Unprepared for Retirement

    Fritz, Good Motivation Sparks Post!

    Per your request…

    What About You?
    Three time retiree and a Retirement Life Coach now.

    Do you consider yourself prepared for retirement?
    Financially yes. 3rd Life Stage Elderhood – Bonus Years, not so much, but developing them exponentially.

    What advice do you have for someone who is unprepared for retirement?

    1. Choose to take control, learn how to control it and make retirement uniquely yours, for every age and stage of your life and your loved ones too. Build your retirement team of advisors and coaches beyond family and friends.

    2. Choose to be a lifelong learner of wisdom, wellness and wholeness so you can live a good, better and best life, regardless of your circumstances.

    3. Choose to realize retirement is a trigger event for your Silver Years to Golden Years transitions in Retirement Life. Like life and retirement, aging happens too! Choose to become “ageless” with the Gift of Your Expanded Life – Bonus Years. While doing the cool stuff, bucket lists and such…live your unlived life by doing your life review, life repair and life legacy tasks to live your best life and end well.

    What steps have I left out of this article which folks should consider?
    Focus, focus, focus planning on answering “My 3 Top Retirement Enough Already? Questions”
    1. Do I have enough resources to live my unlived life with wisdom?
    2. Do I have enough health to live my unlived life with wellness?
    3. Do I have enough time to live my unlived life with wholeness?

    What have you found most helpful for your retirement planning?

    My Top 10 – Helped my retirement personal development, then professional purpose later.
    1. Intentional Retirement by Joe Hearn
    Link: https://intentionalretirement.com/
    2. The New Retirement Forum
    Link: https://www.newretirement.com/answers/categories.aspx
    3. Sensible Money by Dana Anspach
    Link: https://www.sensiblemoney.com/independent-financial-planners/
    4. Caregiving by Jane Barton
    Link: http://www.cardinalife.com/
    5. Retirement Options – Assessements and Coaching
    Link: https://www.retirementoptions.com/
    6. Certfied Senior Advisors
    Link: https://www.csa.us/page/Resources
    7. Awakening the Sage Within (You) by Sage-ing International
    Link: https://www.sage-ing.org/
    8. My Purpose Statement Builder by Franlin Covey
    Link: https://msb.franklincovey.com/
    9. Atlas Care Mapping
    Link: https://atlasofcaregiving.com/practical-solutions/atlas-caremaps/
    10. Spiritual Direction
    Link: https://www.benethillmonastery.org/ministry-center-programs/global-online

    I hope these are helpful in some way or some day.

    Fritz, you do excellent work simplifying the complexity of retirement prep and living…keep up your good works!

  15. It’s tough to save for retirement when you’re trying to pay the bills. My friends with good income are saving for retirement. But friends with uncertain and lower income are having a really hard time. They live a moderate lifestyle like us, but really don’t have much left to save. It’s tough. Increasing income is pretty tough.

  16. This is really great information and a very helpful, concise step by step guide. I am nowhere near my retirement years, but it still makes me a little worried sometimes thinking about being prepared enough, and it is helpful to see information like this. In addition, there is the health side to focus on and preparing for both is no doubt overwhelming, making it awesome to have guides like you have created. Thanks so much 🙂

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