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CHEYENNE, Wyo. — Fewer employers offering pensions, a lack of retirement savings, higher health costs and longer life expectancy is putting the dream of a secure retirement out of reach for millions of Americans.
Sarah Gill is senior legislative representative for AARP. She said the average Social Security check is about $1,200 a month, which isn't enough for many to get by. And the average savings for people nearing retirement age is just $12,000.
"So when you look at that bleak picture, what we see across the country is that one out of every two households is at risk for a financially insecure retirement,” Gill said.
A state task force recently recommended that Wyoming lawmakers consider creating a state retirement plan to make it easier for small businesses to offer plans to some 96,000 Wyoming workers who currently cannot save through their paychecks. Gill noted plans that work in other states operate at little-to-no cost to participating businesses.
Critics in the financial sector have argued states should not be in the financial securities business and say good plans already are available in the marketplace. Gill said only 5% of people save for retirement on their own through marketplace options like IRAs or mutual funds. But people who can save through their paychecks are 15-times more likely to save.
Gill said red and blue states alike are re-considering their roles, mainly because taxpayers end up on the hook for safety-net costs when people don't have enough retirement income.
"In fact, Wyoming could save roughly $18 million between now and 2032 just by helping people save a little extra money of their own for retirement,” she said.
Gill added it's never too late to start saving for retirement, and encouraged people to visit AARP's website for tips on getting it right. She also recommended thinking twice before tapping Social Security benefits. She said waiting until full retirement age can add 8% or more to a regular source of income that you can't outlive.
