How Short are Seniors Falling for Retirement?

Although financial experts recommend that people need about 70% of pre-retirement income to live a comfortable lifestyle during retirement, the vast majority of the country is lagging well behind.

In fact, data reveals there are only two states where households of those ages 65 and older are making at least 70% of the income earned by households between the ages of 45 and 64 years of age.

A study by Interest.com found that seniors in America are falling far short of what they need to retire in almost every state in the nation. Hawaii and Nevada were the only states where households where reaching the recommended income to live comfortably.

Nationally, the income for older Americans is an average of 57% of those in the age group below them. Even worse, in four states, those 65 years and older actually make less than half of those aged 45 to 64 years old. However, the national average of replacement income is better than it was in 2005 when it was just 50.06%.

“We found that many senior citizens are significantly underfunded and risk running out of money, especially since people are living longer than they used to and may need to support a two- or three-decade retirement,” Mike Sante, managing editor, said on Interest.com.

The study analyzed income data from the 2011 American Community Survey by the Census Bureau and found that Social Security, not pensions or retirement savings, is the primary source of income for most retired Americans.

According to Interest.com, the reason households in Nevada and Hawaii are doing better is likely because they have higher percentages of union workers, which means their 65-and-older crowds are more likely to have access to pension funds during retirement.

These 10 states have the worst replacement income levels during their retirement years.

10. New York

Rochester

Replacement income: 52.48%

Median income (45 to 64): $66,589

Median income (65 and older): $34,946

9. Pennsylvania

Pittsburgh. Copyright SeanPavonePhoto | Fotolia.com

Replacement income: 52.21%

Median income (45 to 64): $61,534

Median income (65 and older): $32,124

8. Wyoming

Downtown Laramie. Copyright Matthew Trump | Wikipedia.org

Replacement income: 51.25%

Median income (45 to 64): $67,295

Median income (65 and older): $34,387

7. Minnesota

Downtown Minneapolis

Replacement income: 51.19%

Median income (45 to 64): $69,974

Median income (65 and older): $35,823

6. Connecticut

Hartford. Wikipedia.com.

Replacement income: 50.89%

Median income (45 to 64): $82,223

Median income (65 and older): $41,843

5. New Hampshire

State house in Concord. Wikipedia.com

Replacement income: 50.67%

Median income (45 to 64): $75,582

Median income (65 and older): $38,296

4. New Jersey

Rutgers University campus in Newark | Arthur Paxton

Replacement income: 49.53%

Median income (45 to 64): $82,477

Median income (65 and older): $40,850

3. Rhode Island

Providence

Replacement income: 48.20%

Median income (45 to 64): $68,198

Median income (65 and older): $32,874

2. North Dakota

The Grand Cities Art Fest in Grand Forks.

Replacement income: 48.17%

Median income (45 to 64): $65,902

Median income (65 and older): $31,743

1. Massachusetts

Back Bay, Boston. Wikipedia.com.

Replacement income: 45.21%

Median income (45 to 64): $78,483

Median income (65 and older): $35,483