SAN DIEGO (KGTV) -- The cost of housing in California isn’t just affecting first-time home buyers, it’s also taking a toll on retirees, according to a report from Global Atlantic Financial Group.
The research, based on data from more than 4,000 people nationwide, found that retirees in California spend nearly $2,575 a month: 30 percent more than the average retiree in the U.S. at $2,008.
Housing costs that build up during working years also take a toll. Nearly half of California’s non-retired residents ages 40 and up owe an average of $214,876 on their mortgages, compared to the national average of $134,770.
Global Atlantic claims that sky-high housing expenses force California residents to make sacrifices during retirement, including cutbacks on restaurants and entertainment, travel and vacations and charitable giving.
Almost 40 percent of retirees nationwide are spending more than they expected.
"Many Americans adjust their lifestyles and cut spending once they see how quickly costs can add up in retirement," says Paula Nelson of Global Atlantic.
She says it's an important lesson for those currently in the workforce to understand.
"While older retirees are collecting income from employer-sponsored retirement plans, such as pensions, younger and future retirees may not receive the same benefits. Not only have pensions gradually become less common, but the data shows that younger retirees are also less likely to have much saved in other defined contribution plans, like 401(k)s," says Nelson.
More than half of retirees wish they'd handled their financial planning differently, according to analysts. The top three regrets include not saving enough, relying too much on Social Security, and not paying down debt before retiring.