If you’re nearing retirement age, you may be wondering if you’ll have enough money to live comfortably. With inflation and higher prices hurting many couples in the United States, you may be even more fearful about running out of money after you retire.
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It can be helpful, and perhaps mind-easing, to take a look at the numbers. Here are some insights into income and spending for retired couples.
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Income for a Retired Couple
Let’s start with the average income for a retired couple. Per the United States Census Bureau, the median before-tax income for all households in 2023 was $80,610.
However, it may be more helpful to look at the median income for married couples 65 and older. That number was $84,670 in 2023.
Sources of Income
A retired couple may have several sources of income. According to the Oxford Advisory Group, here are some of the more common:
- Social Security: While the future of Social Security has been a topic of debate this presidential election season, and while Social Security isn’t intended to be the sole source of income for retirees, many retired couples heavily rely on Social Security to live and pay their bills.
- Savings: The amount of savings for a retired couple can vary greatly, partly depending on how early they started planning during their working years.
- Retirement accounts: A couple may have a 401(k), annuity or other investments.
- Pensions: These are becoming less common in U.S. workplaces, but retirees may still have this benefit.
- Jobs and side hustles: Not only can they be sources of income, but jobs and side hustles can help retirees stay active and engaged.
Spending in Retirement
As of 2022, the average expenditure per retiree (regardless of age) is $54,975, or about $4,581 a month, according to the Bureau of Labor Statistics. The biggest expenses for retirees each year include shelter, transportation, healthcare and food.
Planning for Retirement
Even if you’re nearing retirement, it’s not too late to plan. In fact, the earlier you start, regardless of your age, the better off you can be with your finances when it comes to retirement.
So where should you start? According to the Oxford Advisory Group, a first step might be to set retirement goals. “Determine when you want to retire and what kind of lifestyle you envision for yourself during retirement. Consider factors like travel, hobbies, healthcare, and any other specific expenses you might have,” the group wrote.
Once you have a list of goals, you can take a look at your current finances and create a budget. If you’re nearing retirement, you could look at your current budget and income and compare those to what you expect once you retire.
As a couple, it can be helpful to take a look at what you expect from Social Security. You could figure out the best time to start claiming benefits, since delaying your claim can increase your monthly benefit. Together, you can analyze the income sources you expect for retirement and figure out how taxes and insurance may impact those numbers.
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This article originally appeared on GOBankingRates.com: What Is the Average Income for a Retired Couple?
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