Read This Before You Retire

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Countless workers look forward to retirement and the flexible, laid-back lifestyle it offers. Yet a surprising number of retirees ultimately wind up unhappy once they stop working for good.

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In a 2016 study by the Employee Benefit Research Institute, more than 10% of retirees claimed they were "not at all satisfied" with retirement. Meanwhile, close to 41% of seniors were only "moderately satisfied" with their lifestyle, while less than half of seniors found retirement "very satisfying." The percentage of retirees who identify as "very satisfied" has dropped from 60.5% in 1998 to 48.6% as of last year, which paints a somewhat bleak picture for today's older workers.

The survey didn't pin down a cause for retirees' drop in overall satisfaction, but it's fair to say that finances have something to do with it. Over 25 million seniors live at or below the poverty line, due in part to an unhealthy reliance on Social Security, which simply isn't designed to sustain retirees on its own.

Even those who have saved independently are apt to struggle financially in retirement. According to Transamerica, current retirees have median savings of $119,000, but given that folks are living longer these days, that's not a whole lot in the grand scheme of what could be a 25-year retirement or longer. In fact, if that's the amount of savings you're looking at, all it will give you is roughly $400 a month over a 25-year span. When we factor in Social Security -- which, for the average recipient today, equals about $1,360 a month -- that's still just $21,000 a year to live. That's hardly enough.

If you're an older worker who's thinking of retiring, you may want to hold off until you've had time to figure out not only what you want out of retirement, but whether you're in a strong enough financial position to get it. Otherwise, you'll risk joining the ranks of the countless seniors who can't help but call themselves unhappy.

Come up with a plan

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Retirement poses a number of challenges, not the least of which is finding something meaningful to do with your time. Boredom in retirement can, in a worst-case scenario, lead to depression, and in a best-case scenario, leave you feeling dissatisfied and restless.

Before you decide to leave your career behind you, take some time to think about how you'll spend your days in retirement and how much money you'll need to attain the lifestyle you're hoping for. While there's no such thing as a magic retirement savings number to aim for, there is a difference between living it up in an expensive city versus living a quiet life in a quaint little town. Once you determine how you want to fill your newfound free time, you can establish a personal savings target that will allow you to cover your costs.

Save adequately

It's hard to be happy in retirement when paying the bills is a constant struggle. Unfortunately, a large number of seniors enter retirement with minimal savings, thinking they can rely on Social Security to pick up the slack. But that's a mistake, because Social Security will only replace about 40% of the average worker's pre-retirement income. Most folks, even those willing to live frugally, need at least 70% of what they previously earned to stay afloat financially once they stop working, so if you're coming up on retirement and have thus far neglected to save, let this be your wakeup call to stop, rethink that plan, and put in a few more years at the office.

Currently, workers who are 50 and older can sock away up to $24,000 a year in a 401(k). Do that for three extra years, and you'll have an additional $72,000 to work with in retirement (more, if you invest that money and your portfolio performs well). If you don't have access to a 401(k), your next best bet is to save in an IRA. Though the annual contribution limits aren't nearly as generous, if you max out the $6,500 threshold that applies to workers 50 and over, you'll at least be about $20,000 richer by the time retirement starts.

Also remember that the longer you work, the longer you delay dipping into your existing savings. So if you don't feel financially prepared for retirement, whether it's because you're generally behind on savings or haven't socked away enough to support the lifestyle you're hoping for, don't pull the trigger until you're in a better place financially.

Though you might think you're ready to retire, be sure to understand the challenges that come with no longer working. The more thought you put into the decision, the more likely you'll be to one day check the "very satisfied" box on a retirement survey yourself.

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