Average Retirement Income

Looking to see how much retirement income you may need? Make sure and see the related posts at the bottom of this post.

As noted in our post on average retirement savings, it is not exact to define a “retiree” in determining average retirement income. About 15% of the people who classify themselves as retirees are working some hours per week. And as seen in the last graph below, the portion of those working at retirement age is expected to increase to 25% in the next couple years.

What we do know is that in the US, labor force participation falls off rapidly after age 60. So we can assume that for those age 60 and over, we have a majority of people no longer in the labor force. That will give meaning to the two tables on average retirement income below.



	2009 US Census Data
	(figures are dollars per year)
	INDIVIDUALS
	MEN		WOMEN
	Median	Mean	Median	Mean

60 to 64 years	39,797	56,490	22,133	33,655
65 years and over	25,877	38,754	15,282	22,625
..65 to 74 years	28,952	43,934	16,108	25,230
..65 to 69 years	30,859	45,447	17,186	27,416
..70 to 74 years	26,935	41,830	14,892	22,404
..75 years and over	22,762	31,574	14,713	19,875


	HOUSEHOLDS

..65 years old and over	31,354	46,363
….65 to 74 years	38,895	55,575
….75 years and over	25,693	36,347

The first table above shows us income by age for individuals. You may recall that the median is the halfway point between the lowest and highest person’s income. So for men in their late 60’s, the median individual income is just under $31,000. The mean (the average retirement income) however is over $45,000 because there are always a few Mitt Romney types at the top which pulls the average way up for the group.

Also note the significant disparity between men and women and this is assumed to be because women are working fewer hours per week and possibly, in lower paying positions.

The second table shows income by household, not by person. Notice that the household incomes are higher than the individual incomes as you would expect but not a lot higher. This coincides with the expectation that in an older couple, one may work but the other does not. So the income contribution of the non-working spouse may simply be social security income or some pension income.

Not shown here are some variations on average retirement income by region of the country and urban vs rural residency.

Here are some great graphs that provide a lot of insight into the average retirement income of those at retirement age.

Sources of retirement income