Tuesday, May 26, 2015

How Much Money Will You Have at the End of Your Life?

The Employee Benefits Research Institute (EBRI) published a note in April, 2015 that looked at the question of how much money people have at the end of their lives.  A Look At the End-of-Life Financial Situation in America. Here is what the study examined

This report takes a comprehensive look at the financial situation of older Americans at the end of their lives. In particular, it documents the percentage of households with a member who recently died with very few assets (total assets as well as non-housing assets). It also documents income, debt, home-ownership rates, net home equity and the share of their income coming from Social Security benefits for those households.

This report is useful as part of the work by EBRI in looking at retirement security and whether people will have sufficient funds to last the rest of their lives.  Here are some bullets from the conclusion:

  • For those who died at ages 85 or above, 20.6 percent had no non-housing assets and 12.2 percent had no assets left.
  • Among singles who died at or above age 85, 24.6 percent had no non-housing assets left and 16.7 percent had no assets left.
  • Those who died at earlier ages were generally worse off financially: 29.8 percent of households that lost a member between ages 50 and 64 had no assets left. 
  • People who died earlier also had significantly lower household income than households with all surviving members. 
  • Among singles who died at ages 85 or above, 9.1 percent had outstanding debt (other than mortgage debt) and the average debt amount was $6,368. 
  • The average net equity left in their primary residence for those who died at ages 85 or above was $141,147 and $83,471 for couple and single households, respectively.

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