Retirement Reality Check: “ONLY 5% WILL SUCCEED”

Besides having the American dream of home ownership, a lot of people have the American dream of one day, I hope I can retire, which is quickly becoming a thing of the past as well due to the skyrocketed cost of living. But did you know that even once you make it towards retirement, doesn't guarantee you a happy life. In fact, only 5% of retirees right now say that they are living the dream and 19% say that they are living the nightmare. And clearly 20% versus 5% is already a huge gap. And then you just probably have somewhere people in the middle that just say, it's okay. They're not living the dream, but also things could be worse. Now this data comes from Schroeder's 2025 US retirement survey. And the reality is you should start saving for retirement as soon as you start working. That's the advice that everybody gets as soon as they start working. But most people don't follow it, including myself. I didn't either, because when you're 18 years old or even 16, like I was when I got my first job, retirement seems so far away into the future. And it is, you know, nobody wants to think about that when you're just getting your driver's license or just getting your first girlfriend, you could care less about retirement, right? And unfortunately for the retirees who say that they're living a nightmare right now, it's already too late for them. They can't go back and fix any of their mistakes that they made in the past, which would have helped them have a more comfortable retirement. But if you still have a decade or more left before retirement, it's not too late for you. So there are some things that you can do to try and have a more comfortable retirement when the time comes, assuming you ever make it to retirement, because the reality is a lot of people will just never even make it to a state that they can call retirement because it just costs too much, which we'll talk about more later in the video. So the first thing is you're probably not saving enough for retirement in most cases. According to the research, about half of all retired Americans believe that they saved enough for retirement, but 45% of retirees say that their expenses are higher than they anticipated. And especially when you're in your 20s and 30s, you have a lot of other financial requirements as well, like your student loan debt, car payments, saving for a house, paying the rent, having a life, leisure activities, going out for that coffee you love so much, whatever it might be. But the problem is your 20s go by in the blink of an eye. All of a sudden you're in your 30s or 40s, now you only have less than 30 years before it's time to retire and you haven't done anything about it. And by the time you reach your 40s or even your 50s, all of those financial obligations you had starting in your 20s don't go away. They just surmount. They get larger. You have more obligations as life goes on, not less. Instead of paying off student loan bills, you're paying for college tuition bills for your children. You're paying for your house payments. You're paying for the maintenance on a home. You're paying medical expenses. You're paying repair bills on your home because everybody told you you have to own a home. That's the only way to build wealth. So the idea here is you got to start saving early and save as much as you can as early as you can, because that will lead you towards being able to retire not only sooner, but even if you choose not to take an early retirement, you're going to have a much larger nest egg saved up than somebody who only started saving in their 30s or 40s. By the way, I'm walking along Richardson Bay here on Seminary Drive in Strawberry, California. Here's the second thing when it comes to saving for retirement is you have to expect the unexpected. For example, in 1980, the inflation rate in the United States peaked at 14.7% and in 2022 recently it peaked at 9% and that's an unexpected increase in cost of living. And they like to tell you that the inflation rate is back down to 2.3%, but we all know it is much higher than that. That is just the phony number that they want to tell you it is to make things look good. But the point is that when you want to retire, you have no idea what the inflation rate's going to be. And if they don't fix the way inflation is calculated, whatever the number they tell you it is once you reach retirement age is going to be completely inaccurate. Also the stock market could be in a bull market. It could be in a bear market when you're ready to retire. You don't know where it's going to be at. And that's why the top concerns that plague people who want to retire are inflation. 92% of retirees are at least slightly concerned about inflation. They're also concerned about rising healthcare costs and the potential for a major market downturn because obviously if you're living entirely off of your retirement savings in your retirement accounts, a sudden drop in the market can significantly reduce your assets. I did not think it was going to be this windy out here. Hopefully you guys can still hear me. And that's really why you should be saving more than you think you will need. You don't want to over-save for retirement to the point where you cannot pay for the things you need to pay for today in life or to the point where you cannot enjoy your working years and never take a vacation or anything like that. It doesn't have to be to that extreme. But if you think you're going to need $1.5 million, why not save $2 million or $2.5 million and go quite a bit beyond your goal number. So that way once you do reach retirement and you have all these unexpected expenses and worries like a lot of people retiring right now, you won't have to worry. You'll be set because you did save extra. I just got to show you guys this. Check out this fog. The wind is totally insane right now. You can just see that fog blowing over the mountains here. And that fog makes it pretty cold actually. It looks warm out here, but it actually feels kind of chilly. All right, I'm going to go back and get out of this wind. Here's the other thing when it comes to retirement savings is that winging it will not get you to your destination. A lot of people rely too much on Social Security once they retire and they just kind of leave their retirement savings as a very low priority thing during their working years and often end up severely under-saving for how much they're actually going to need. And as you can ask any person trying to live on Social Security these days, however much they're getting from that government check is probably not enough. And the people who are making it work definitely do not have the finer things in life for the most part. I think everybody who's working towards retirement and even who is in retirement should have a financial advisor. This is not like a sponsored post or anything. I just think it's smart financials to do it. But 64% of retired Americans aren't working with a financial advisor and 44% don't have a plan in place for estimating their expenses or determining how much income is going to be needed and developing an investment strategy to meet their goals. So it's like, how do you know how much to save or how much you're going to need if you never calculate any of this stuff? Just guessing and throwing in the retirement account what you can and hoping for the best in 30 or 40 years is not a plan. Now this isn't to say that you need to have a financial advisor forever, but you do need to have one at one point to kind of set you up on the right track for success. And then if you can follow that track without their help, well then great. But a lot of people are too busy with life and they do need that ongoing help. Even me guys, I hired a financial advisor this year actually because there's a lot of moving parts when you're investing for the future. It's not something I want to be thinking about every single day and I'm not just taking a fully hands-off approach and just letting them do whatever with my money. No, I'm actively involved in what's going on and the decisions that we're making together. And the thing I like about it is it's very inexpensive, first of all. You get some fantastic advice when you hire a fiduciary, somebody who by law has to look after your best interests when making different decisions on what to do. And it reinforces some of the ideas or maybe even brings up new ideas that you never had before on what you should do next. Another reason I wanted to hire a financial advisor is because I have this goal that I've mentioned before here on the channel, which is that I want to be able to retire in 10 years financially. I know for sure I probably won't do that. Even though I could do it, I probably won't because I really enjoy what I do here on YouTube. But I want to be able to because, you know, life happens. You don't know what the future holds and maybe I want to slow down by then. And just having the ability to stop working anytime you want is probably the most powerful thing that you can have. But the thing that's standing in the way of most people ever reaching retirement is not just not saving enough for retirement or not planning properly. It's also the fact that the cost of living has gone up so much that only a very small percentage of people's incomes can even go towards retirement savings these days, even under the best circumstances. And we don't even have to look any further than the price of food, especially groceries at the grocery store as one of the biggest expenses that are stressing people out right now. According to the BLS data, grocery prices went up 2.4% in June year over year. And according to a recent poll from the Associated Press, they found out that half of Americans describe the cost of groceries as a major source of stress in their life right now. And now we have the tariffs that are expected to impact about 75% of the U.S. food imports. So food prices are going to go up even more once all these tariffs take full effect. Here's some examples of things you can expect to be paying more for at the grocery store very soon. Bananas. 90% of bananas are grown outside the United States. So we're going to be hit with the tariffs on those. Paper products. For example, Procter & Gamble, they just announced they're going to be raising prices in reaction to the tariffs. And they make things like toilet paper. They make Tide laundry detergent. They said they're going to be raising prices by about 25% on those products starting this month actually. So look out for that. And even though they're raising prices, they say they're going to be taking a $1 billion hit from the tariffs even though they're raising prices. Beef. That's another big one. I know I'm going to be feeling that one considering that's my favorite food to eat. A pound of ground beef in the United States is on average $6.12, which is up nearly 12% from a year ago. And that's just the conventional stuff. If you want organic, grass-fed, high quality, the prices are triple that. The average price of uncooked steak right now is $11.49 a pound. That's up 8% from a year ago. Then you got chocolate. That's another one I'm going to be feeling. Chocolate and beef is like my two favorite foods. And the increases are supposedly because of the bad weather and crop diseases that they've had in areas where they grow chocolate and especially in Africa. Hersey just announced last month that they're going to be raising prices in the low double digits on their chocolate products. Coffee's another big one that pretty much everybody likes. And coffee's already gotten pretty expensive recently, even before the tariffs. And now that there's a 50% tariff on Brazil, which is one of America's biggest sources of coffee, you're going to be feeling that one. The average price of ground roast coffee is about $8.13 a pound, which is up from the $6.25 it was just a year ago. And back in 2020, it was only $4.52, so it has almost doubled since 2020, the price of coffee. This next one won't matter if you're not a drinker, but beer, wine, and spirits, pretty much all different types of alcohol prices are going to be going up. And not all these price hikes are due to the tariffs. I know that the media wants to make you believe that they are, and some of them are, but some of them are just because of inflation and because of the rising costs to produce everything. And of course, you're going to have prices on fish and other seafood going up. And that is due to the tariffs, because about 80% of the seafood consumed in the US is imported. And if it's not the rising grocery costs that are going to slow down your retirement savings, well, then it's probably going to be your health insurance premiums, if you can even still afford to pay them, because that is one of the fastest rising costs for Americans that most people have. This is some jaw-dropping data. Take a look at this. Since 1999, health insurance premiums for people with employer-provided coverage have more than quadrupled. And just from 2023 to 2024, it went up by 6%. And if you have one of the Affordable Care Act plans, like the Obamacare plans, like I have, because you're self-employed, you're seeing an even bigger increase in your premiums. And I have felt it as well. I think the premiums that my wife and I pay combined for just the two of us, guys, no kids, is close to $1,100 a month right now. It is insane. And honestly, I don't even think the insurance is that great. Now, state regulators do scrutinize insurance increases for health insurance, but only if the increase is above 15%. So if they raise it by 5% or 10% every year, they don't even bat an eye. And apparently, things are projected to get worse into 2026. If you have Obamacare, the proposed prices going into 2026 are not looking good. In New York, for example, UnitedHealthcare has proposed a 66.4% increase in prices. HMO Colorado has asked for an increase of more than 33% in the state. In Washington, the average proposed increase across all insurers is 21%, and it's projected to go up by 23.7% in Rhode Island. And health insurance is becoming so unaffordable that even employers are going to be struggling to pay for any sort of health insurance for their employees in the near future. Already right now, according to a recent survey from businesses, 87% of companies said that in the next five to 10 years, the cost of providing health insurance for their workers would become unsustainable, which means that within the next decade, most people are probably going to be on their own. And so almost every plan in the Affordable Care Act is projected to increase by at least 20% next year, which means for me, for my example, paying $1,100 a month, we could then be paying over $1,300 a month next year. For what? For probably worse coverage. To me, it's getting to the point where having health insurance actually doesn't make any sense anymore. I had to do an emergency room visit a couple of years ago, and the final bill was close to 20 grand. So that's a lot of money, right? However, if you're paying $1,100 a month for two years, you already paid for that 20 grand. Of course, you won't have your regular annual checkups covered if you don't have health insurance or any other specialist visit. You have to pay out of pocket. But man, if you're young and healthy, that is a chance that I feel like I'm more and more willing to take because this is just getting out of control. Now, some of the state regulators could jump in and say, well, you can't raise it by 20%. We're only going to allow you to raise it by X amount or whatever. And if you're somebody that has the Obamacare insurance like I do, you probably notice that year after year, once you have to enroll, the plan options are always different. You never really have the same plans available. Sometimes even the same plans change the type of doctors or services that are covered, all these different types of things. And that's due to all these proposed increases and how they want to operate and whether or not your state approves those operations or not. And some of them just don't care. They just let them do whatever they want. So due to the changes that just happened with the big, beautiful bill, along with these increases in insurance, it's projected that in 2026, about 16 million Americans are expected to become uninsured. There's just another thing that is bankrupting people, guys. If you want to keep the insurance, you're stuck paying crazy amounts of insurance. If you don't keep it, then you're rolling the dice every time something happens, especially if you end up in the emergency room, that you could be stuck with this five-figure or even six-figure hospital bill, like what happened to me. I had insurance. I didn't have to pay that 20 grand. It ended up costing me around $700, all in all. But still, and don't forget that these insurance companies in the United States are for-profit companies and they act in the interest of their shareholders, not their patients. So you wonder why these premiums are going up? It's the combination of that, as well as the fact that look at the price that they pay for all these things. If you've ever been to the emergency room or had a hospital bill, look at the financials of it, guys. Look how much they pay for different tests or how much a doctor charges just to see you for five minutes. And you'll quickly realize why insurance costs are also so high, because it's the same reason that college tuition is too high. Once you're able to throw all this money at something, they can suddenly charge a lot more with little to no consequences, other than the fact that the prices go up and so do the premiums. And it's not just the premiums that are going to go up. The deductibles are going to go up, which is your out-of-pocket that you have to spend before insurance kicks in. And it's because of all these rising expenses is why I'm telling people that likely there's not going to be a lot of people being able to retire in the future, unless you can just go without a bunch of this stuff and save for retirement and hope you get lucky and never really have any problems. That's probably going to be your best bet. Unfortunately, this is the world we're living in right now. But that doesn't mean you shouldn't try. I still think that everybody should make a good attempt, a good effort at saving for retirement and God forbid if something happens later down the road where you need to tap into that money, at least you have it to tap into, right? That's the main thing. It's better to at least have it and not need it, or actually have a good retirement nest egg in the end if everything goes well, than to just say, oh, I'm not even going to try because things are so hard and then end up in a much worse place later on. So if you guys enjoyed this video, make sure you subscribe to the channel. And if you don't want to wait for my next video to come out, check out this one on the screen right over here. And I'll see you in the next one.