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10 min

Posted by

Ashley Murphy, CFP® GFP Fellow

Ashley works with clients to bring strategy, structure, clarity and confidence to their global financial lives and keep it that way. In 2013, Ashley founded Arete Wealth Strategists, a fee-only financial planning and investment management firm for Australian/American expatriates.

January 4, 2023

Retirement at a Glance

TAX-FREE RMDs – Taxpayers age 70½ or older can make a tax-free qualified charitable distribution (QCD) of up to $100,000 directly from their IRA to a qualified charitable organization each year. A QCD counts toward their required minimum distribution (RMD) for the year (source: IRS).
BOOMERANG KIDS – A majority of parents (70%) say they do not discuss money management or set financial expectations with their adult children. In late spring 2022, 40% of parents surveyed said they had an adult child living with them; 35% of those parents said they have compromised their long-term savings goals to help their children financially (source: Thrivent).
INVOLUNTARY RETIREMENT – Over 25% of older white workers and 40% of older Black and Hispanic workers have physically demanding jobs. Among those who retire between ages 55 to 64, 51.6% of white workers and 60% of Black and Hispanic workers retire involuntarily because of job loss and health issues (source: Schwartz Center for Economic Policy Analysis).
BASIC INSTINCT – 46% of people surveyed said they will base their decision to retire on their age rather than attaining a certain amount of savings. Another 30% said they don’t have a plan for deciding when to retire (source: Stanford Center on Longevity).
ESTATE PLANNING? – The average amount families spend after a loved one dies is $12,702, which includes $7,267 on a funeral and $5,846 on lawyers, financial advisors, and realtors. Only one in seven families had any immediate costs prepaid or were able to use POD funds. (source: Empathy).
IT’S OFFICIAL – Social Security retirement benefits are getting the biggest boost in 40 years with an 8.7% increase! The maximum amount of a worker’s pay subject to Social Security tax is also increasing, from $147,000 in 2022 to $160,200 in 2023. Increasing this threshold (e.g., to income above $250,000) has been proposed as one solution to the Social Security funding crisis (source: Social Security Administration).
GOING BACK TO SCHOOL? – For those considering or re-considering their career options, “nurse practitioner” is projected to experience a 45.7% growth rate in the next 9 years –the fastest employment growth of all occupations –as healthcare facilities increasingly use team-based models to provide patient care that would otherwise be provided by a doctor (source: U.S. Bureau of Labor Statistics).
A CRYSTAL BALL – About 43% of retirees underestimate their life expectancy by at least 5 years. This longevity calculator can help retirement savers consider the risks of outliving their financial resources by helping them calculate their personal life expectancy (source: Society of Actuaries).
THE CONFIDENCE OF YOUTH – 78% of Millennials (age 26 to 41) and Gen Z (age 18 to 25) claim they are knowledgeable about the stock market and the companies they invest in, which is almost four times the percentage of Boomers (age 58 to 67) (20%) that make that claim. The younger investors also expect a higher average annual return (17%) over the next 10 years than Boomers do (11%) (source: Stanford Graduate School of Business).
DON’T DO IT – 60% of millennials say they would cash money out of their retirement plans in the event of a large market downturn, defined as a decrease of 10% or more in the major market indices (source: Cogent Syndicated report from Escalent).
FALLING SHORT – A lot could change in the next 20 years, but current estimates project that 38% of early Millennials (born 1980-1989) will not be able to cover basic needs or replace at least 75% of their annual preretirement income at age 70 (source: Urban Institute).

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