How Americans Really Retire

6 minute read time.

There’s not a set template for retirement anymore. There’s so much variety, and there are options at various income levels—you just have to find what you’re passionate about and find the thing that’s going to make you sing in retirement.

What is it like to retire with a $5 million nest egg? Or, how does it feel to head into retirement, relying solely on Social Security? How about living the nomadic life and retiring on a boat?

These are just some of the real-life stories veteran reporters Veronica Dagher and Anne Tergesen have told through a special series they write for The Wall Street Journal. In it, they share the experiences of retirees whose lives have been shaped by how they funded their retirement.

Recently, Veronica and Anne joined us on Your Money Map to offer insights into the evolving U.S. retirement landscape and share some of the most interesting takeaways from their reporting – everything from why people say they’re afraid to spend their savings, to putting down new roots in order to stretch your retirement nest egg further.

BEHIND THE FEAR OF RETIREMENT SPENDING

Alliance for Lifetime Income research shows that one of the biggest obstacles retirees face is spending down their savings. A recent analysis found that even when people can easily afford it, many retirees are reluctant to spend to enhance their lifestyle. Instead, they rely far more on lifetime income sources—such as Social Security, pensions, and annuities—than on withdrawals from IRAs and other retirement accounts.

Tergesen and Dagher’s reporting has shown that those who are reluctant to spend fall into a couple of different categories. There are those who have less money saved and pinch pennies for good reason. Then, there are people who have saved a lot, but have ingrained savings habits that are hard to break. “I think it pinches their lifestyle a little bit, but it also gives them sort of the reassurance that they need to not be anxious all the time about money, and to relax a little bit, and to think about how they can really fulfill themselves in retirement,” says Tergesen.

WANDERLUST AS A SAVINGS STRATEGY

When it comes to stretching retirement dollars, Dagher and Tergesen say they’ve encountered many retirees who have moved to do so. For some, that means putting down roots abroad. “In certain cases, some of those folks were having a really tough time making their retirement work in the U.S.,” explains Tergesen. “They were afraid their dollars weren’t going to stretch through the entirety of their retirement. Yet, they moved abroad to some place like Portugal or Spain, and all of a sudden, they were in a much better financial situation.”

For others, making your savings go further means moving to another, more affordable state or city. “That’s something that really stood out to me, that willingness to have a little wanderlust in your retirement, even within the U.S., that can be beneficial,” she adds.

PASSION IS POSSIBLE, REGARDLESS OF YOUR BANK ACCOUNT

In their reporting, Tergesen and Dagher have shared the stories of those who retire with very little savings – no 401(k), little to no investments, and nearly no income, aside from their monthly Social Security check. Yet, these people are still finding happiness in their retirement. “They have their challenges and sacrifices they have to make, but they’re also finding meaning and happiness in defining what makes their retirement work for them, whether that’s time with like-minded people who also like to play the guitar or like to play chess or volunteer or meet for potlucks,” says Tergesen.

As people search for their new passion and purpose in retirement, Dagher and Tergesen say they’ve found through their discussions with retirees that “there’s not a set template” for retirement anymore. “There’s so much variety, and there are options at various income levels,” says Dagher. “You just have to find what you’re passionate about and find the thing that’s going to make you sing in retirement.”

SINGLE WOMEN FACE RETIREMENT CHALLENGES, BUT VALUE CONTROL

It’s no secret that women are often at a disadvantage when it comes to saving for retirement. ALI research found that 51% of women in the Peak 65® Zone have less than $100,000 in assets, and among single women in this demographic, the number jumps to 67% who have less than $100,000 in assets for retirement.

As Dagher and Tergsen explain, they’ve seen both the upsides and downsides of retirement as a single woman. “They [women] live longer, they tend to make less. They often have caregiving responsibilities,” says Dagher. “And if they’re single, they don’t have a partner to rely on, and that can be a challenge. Just making that money last and being the backstop for all of your finances, it’s all on you, if you’re a single woman, and that can be tricky.”

On the flip side, Dagher says that for many single women, having complete control of their finances during retirement is something they enjoy. “This general idea out there that women aren’t involved in finances, don’t care about their money, or are confused by it, I think these are old stereotypes, and some of our reporting certainly showed that,” she says.

KNOW THE PERKS OF PROTECTED INCOME, INCLUDING THE “SLEEP WELL AT NIGHT FACTOR”

One of Dagher and Tergesen’s latest profiles featured people retiring with a pension, which is something that’s become a rarity. As Dagher explains, for these people, the peace of mind provided by a pension is invaluable. “It gives you a whole level of ‘sleep well at night factor,’ folks feel a lot more secure,” she notes. “They feel comforted by the fact that they know they’re going to have a certain amount of money coming in each month, and that gives them the reassurance to feel that they’ll be able to make their bills, and they’ll be able to make their budget.”

As Tergesen reported recently, there was an uptick in another type of protected income in recent years – annuities, and more specifically, fixed-rate deferred annuities, with their sales being prompted in part by rising interest rates, as well as “demand from baby boomers seeking conservative investments.” A recent survey suggests that the current economic uncertainty may bring about another surge in sales.

See: How to Protect the Retirement You Want

LEARN FROM RETIREE REGRETS

In their reporting, Dagher and Tergesen have gotten the opportunity to talk with retirees not only about what’s working in their retirement, but also about what they wish they’d done differently.

For Dagher, one of the biggest regrets she’s heard is waiting too long to do what you’ve long dreamed about. “It sounds crazy, but for some people, they’ll say, I realize maybe I should have had a little bit more fun with my money,” she says. “I wish I had traveled earlier in my retirement, in my 60s and 70s, because I realized my health wasn’t the same as I got older, and it wasn’t as easy to travel generally.”

Tergesen says one of the bigger takeaways from her reporting is that in retirement, relationships are the key to happiness, so don’t want to build them. One of her favorite retiree profiles featured Jim Lee, a Michiganer who retired early, at age 54. A struggle he faced early on was staying connected with people.“He tries really hard to have lunch, you know, once or twice a week with a friend, or go on a bike ride, or just do something where he’s social and focusing on building friendships,” says Tergesen.

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