Common Retirement Financial Challenges

By Brent Meyer — SafeMoney.com Founder & Editor Reviewed by Licensed Financial Professionals  |  SafeMoney.com — Trusted Since 2011  |  Updated Regularly Quick Answer: Avoid common retirement financial challenges with safe money strategies. Learn how to secure your future today! Visit SafeMoney.com for expert advice. When it comes to lifestyle, it can be said that we have “two” lives – or rather two different life phases. The first phase is the working years, or when we work for a living. The second phase is retirement , or when we can choose to stop working, should we desire to, and do what we want. From volunteering or spending time with family to social gatherings, vacation getaways, gourmet dining, or personal luxuries, there’s no shortage of ways we can enjoy our time in retirement. However, many Americans who are retired or nearing retirement face unique barriers – financial challenges which can keep them from enjoying the lifestyle they worked hard for. Preparation is key, so the importance of planning ahead can’t be overemphasized. Here’s a quick look at some common financial challenges to account for. Common Financial Challenges 1. Household debt. One challenge that can stretch retirement finances thin is household debt. A study by the Employee Benefit Research Institute on American households aged 55 and older from 1992 to 2013 illustrates this. Research found 64% of retired and near-retired households had financial liabilities in 2013, up from 53.8% in 1992. The biggest issue was mortgages and home-equity debt. 42% of households aged 65-74 were saddled with housing debt, a 24-point jump from just 18% in 1992. Recent data from the U.S. Bureau of Labor Statistics helps confirm this – housing expenses, which include mortgage payments, was the biggest spending category for retired households in 2014. Student loan debt is a surprising factor in retirement. According to the Government Accountability Office, senior citizens had $18 billion in student loan debt in 2014, up over 600% in less than a decade. Over 20% of the student loan debt was for helping children with educational expenses such as college. In more recent statistics, credit card debt has proven influential. Among American households aged 65-69, average credit card debt is $6,876 – over 200% more than maximum monthly income payouts you can get from Social Security . 2. Low interest rates. For retirement income, many Americans draw on earnings from low-risk, interest