Low-Income Americans Will Need To Regularly Work Into Their Eighties: Study

If you were thinking of retiring in your sixties, think again. And according to a new study, even seventy is pushing it.

The study by the Employee Benefit Research Institute, entitled “The Impact of Deferring Retirement Age on Retirement Income Adequacy,” says the future of the American worker, particularly those in lower-income brackets, is one that requires working much later into life.

Only by retiring at 75 years old would a majority of those in the lowest income quartile -- defined as earning below $11,700 annually -- have half a chance of not running out of money during retirement, the study finds. Working until 85 years old doesn't completely secure Americans, either. Indeed, a majority of workers that age making less than $31,000 annually still have a roughly 20 percent chance of running out of funds, the report finds.

Even when accounting for benefits provided by Medicare and Social Security, early retirement remains little more than a pipe dream, the report finds.

The issue relates to the simple fact of people living longer. In 1940, only an estimated 9 million Americans were 65 years old or older, or approximately 6.8 percent of the population, according to the Social Security Administration. By 2000, the last time the study was taken, 34.9 million Americans were 65 years or older or older, or approximately 12 percent of the population according to the U.S. Census Bureau. And by 2050, that number is expected to increase to 21 percent.

"The full retirement age would have to increase to 73 for adults to have the same expected years of remaining life in retirement today as in 1940," Urban Institute senior research associate Melissa Favreault and senior fellow Richard Johnson note in their research, cited by CNN.