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Updated: May 24, 2023

Factors Hindering Retirement At 65


Although 65 used to be the age at which people received full Social Security benefits, a decision made by the Social Security Administration in 1983 changed that. Those born in 1960 or after will qualify for full benefits at 67.

There are several relevant questions that you might already be wondering. How much money should you aim to save? How can you make the most of your Social Security? And what are you supposed to consider when coming up with your post-retirement budget?

A good starting place to begin is by tallying your current expenses and bills, including the monthly cost of utilities, transportation, food, mortgage payments, and leisure and traveling. On top of that, you'll want to be sure to leave some extra money to cover the costs of any unforeseen health crises, as according to a MetLife Mature Market Institute Survey, 31 percent of baby boomers say that long-term health care costs are a source of anxiety for their household.

You'll also need to factor in tax expenses, for instance, if the retirement savings pot you're contributing to requires that money to be taxed upon withdrawal. When you feel you've tabulated every possible cost, multiply the sum by 12 months, and then by twenty so that you come up with a realistic figure for what you'll need in retirement.

If you want to a no-fuss way of figuring out your savings, a formula many industry professionals go by can help give you a rough guideline:

Retirement Formula

By Age Salary Multiple
35 1x
45 3x
55 5x
67 8x

As shown in the table, some experts estimate that those saving for retirement need to earn eight years of their current salary to live comfortably in retirement. Yet another formula by MSN Money reports that if you want to enjoy your current standard of living when retired, you'll need to calculate 80 percent of your monthly spending now to know how much to save.