With recent economic challenges and rising costs of living, retirement is on many Americans’ minds. You may be wondering: Is the state of retirement in the U.S. worse than in other countries?
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That depends on which country you’re talking about. Read on to learn about the average retirement age in the U.S. and UK, plus current retirement processes, to compare the difference.
Also see a comparison of retirement in America vs. Japan.
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What Is the Average Retirement Age in the US?
According to a recent survey by MassMutual, the average retirement age in the U.S. is 62.
The poll shows that most pre-retirees and retirees think 63 is the ideal retirement age. However, around 35% of pre-retirees say they are too far behind in their savings to reach that goal.
To sum it up: If you’re preparing to retire in the U.S., you can probably expect to do so in your early to mid-60s.
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What Is the Average Retirement Age in the UK?
As of 2021, the average retirement age in the UK was just over 65 for men and 64 for women. As in the U.S., this average age has increased since the 1990s — but not quite as dramatically. The average retirement age for men has increased by around two years for men and four years for women.
To sum it up: As a UK worker, you can expect to retire in your mid-60s.
Retirement in the US vs. UK: How Are They Different?
The average retirement age in the U.S. and UK are fairly similar. But how do retirement processes differ in each country?
US: Social Security and Personal Savings
In the U.S., retirement is largely dependent upon Social Security. If you have worked and paid Social Security taxes for at least 10 years, you can start receiving benefits at age 62. The monthly benefit amount increases the longer you put off retirement, up until age 70. The amount you receive in Social Security depends on how long you have worked and paid into the system.
However, Social Security benefits generally aren’t enough to support a retiree in the U.S. The average monthly payout as of June was $1,918. To retire comfortably in a city like Los Angeles, a single person must have around $2.3 million saved (beyond Social Security), according to recent GOBankingRates data.
UK: State & Workplace Pensions
In the UK, the government pays a state pension to all eligible citizens when they reach official retirement age — currently 65 for most people. Unlike Social Security in the U.S., this pension is paid with current taxes, so your payment doesn’t depend on how long you’ve paid into the system. UK pre-retirees also can earn pensions through their workplaces or set up personal pension schemes if they’re self-employed.
The average state pension payout in the UK is £169.50 per week ($222) or around £8,800 annually ($11,547). Combined with workplace pensions, the average UK pensioner earns around £18,148 ($23,812) per year, lower than the standard UK income of £34,963 ($48,876). So, retirees in the UK are also at least partially dependent on personal savings to live comfortably.
Which Country Is Better for Retirement?
It’s impossible to evaluate whether the United States or United Kingdom is “better” when it comes to retirement. Although the UK’s pension system is more egalitarian, people tend to retire older and still depend at least partly on personal savings, as in the U.S. Regardless of where you live, investing in your retirement savings from an early age is the best way to set yourself up for a comfortable retirement on your own terms.
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This article originally appeared on GOBankingRates.com: The Average Retirement Age in 2024: US vs. UK
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