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What the average American retiree makes

Americans 65 years and older reported a median annual income of $47,620 in 2021, according to the United States Census Bureau. However, the median for all households came in much higher, at $70,784. Furthermore, the 65-and-older figure was 2.6% lower than in 2020. Especially once medical expenses are factored in, it’s risky at best to count on Social Security to cover all retirement expenses.

Still, not all Americans over 65 are actually retired; they may still bring in income from work. So the big question is this: If you take in roughly $47,000 annually from Social Security alone, but can add to it, what will your quality of life look like?

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The many sides of retirement expenses

To answer that question, a number of critical factors must be addressed: the place you live and its cost of living, your overall health, and the expenses you carry, discretionary versus necessary.

The Bureau of Labor Statistics broke down the expenses of those 65 and older, taking into account combined income sources, including savings and Social Security benefits, Americans aged 65 and over spent an average of $49,872 as of 2021 — higher than that $47,620 median annual income figure cited above. The expenses break down to $54,418 for those 65 to 74 and $43,316 for those 75 and over.

No wonder, then, that many American retirees re-enter the workforce later on. About 1-in-6 retired Americans continue to consider a return to work, according to a study by PayChex. It should be noted, though, that boredom may play a role here; slightly more than half of retirees (55%) went back to work because they needed more money.

So what will it be: Back to the grind or back to the drawing board? To the latter point, consider meeting with a financial adviser to work out smart solutions with the money you’ve got: how you can cut back, downsize or unlock the potential of your assets.

The key is to make the numbers work in your favor. And if the numbers show more red than black, fear not: Stories abound of creative seniors with below-average incomes who enjoy far-above-average retirements.


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Amy Legate-Wolfe Freelance contributor

Amy Legate-Wolfe is an experienced personal finance writer and journalist. She has a Bachelor of Arts in History from the University of Toronto, a Freelance Writing Certificate in Journalism from the University of Toronto Schools, and a Master of Arts in Journalism from Western University. Amy has worked for Huffington Post, CTVNews.ca, CBC, Motley Fool Canada, and Financial Post. She is skilled at analyzing trends and creating content for digital and print platforms. In her free time, Amy enjoys reading and watching British dramas on BritBox. She is a mother and dog-mom to a Wheaten Terrier.


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