Many members of the next generation of retirees are expected to face a large decline in their standard of living when they retire, according to a new report.

The report, from the Society of Actuaries, found that making retirement decisions based on averages increases the risk of running out of money, Moderate and higher-income households can successfully retire with 20 percent less savings if they are willing to cut their discretionary budgets by 15 percent, according to the report. Purchasing an annuity must be balanced against the need for an adequate emergency fund. Purchasing long-term care insurance reduces emergency fund needs for lower income and wealthy households.

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