I wonder how many people will accept this finding? I ask that because many of us are willing to accept polling that says 70+ % of Americans are living paycheck to paycheck or can’t cover $400 in unplanned expenses. A finding I find very hard to accept.
The most convincing evidence is what retirees say about themselves, Biggs notes. According to Gallup, more than three-quarters of retirees (78 percent) say they “have enough money to live comfortably.” The Federal Reserve’s Survey of Consumer Finances finds that 75 percent of Americans 65 and over have “at least enough to maintain [their] standard of living.” That is up from 61 percent in 1992.
The polling organization NORC at the University of Chicago regularly asks respondents about their financial situation. “In all recent years,” says NORC, “those 65-plus have shown the least financial dissatisfaction.”
In 2014, 45 percent of 65-plus respondents were “satisfied” with their finances and 37 percent were “more or less satisfied.” Only 18 percent were “not at all satisfied.” By contrast, only 21 percent of the 35-to-49 group were satisfied, 50 percent were “more or less satisfied,” and 30 percent were “not at all satisfied.” True, most people’s incomes drop when they retire. But their expenses also typically drop.
The stereotype of most old people tumbling into poverty is wrong, in part because their incomes are significantly underreported. An important recent paper by economists Adam Bee of the Census Bureau and Joshua Mitchell of Welch Consulting estimated that, after correcting for the missing money, the median income of elderly households in 2012 jumped almost a third, from $33,800 to $44,400.
The poverty rate among the elderly, already much lower than in the general population, also fell by a quarter. The main sources of underreporting involve income from IRAs, 401(k) plans and traditional pensions.