Can you afford to retire?

NATALIE MORALES, anchor: This morning on TODAY'S MONEY , can you afford to retire? Millions of older Americans can't afford to walk away from their jobs because they're saddled with too much debt. Jean Chatzky is here to help, and she's TODAY's financial editor and the author of " Money 911." Jean, good morning.

Ms. JEAN CHATZKY (TODAY Financial Editor): Good morning.

MORALES: So we're finding that the golden years are not so golden anymore. What is going on?

Ms. CHATZKY: Mortgages are actually the big problem. The Wall Street Journal did a story and laid it all out.

MORALES: Mm-hmm.

Ms. CHATZKY: And when you look at people who are 60 to 64 years old, about 40 percent of them have mortgages. That's double the number that had mortgages 15 years ago. And those mortgages have doubled in size. They're an average of $80,000.

MORALES: And why are we seeing this sort of rear its ugly head now?

Ms. CHATZKY: Because if you look at what happened in the housing market, housing was just going up, up, up, up.

MORALES: Mm-hmm.

Ms. CHATZKY: And people thought they could pull money out of their homes and still have a nice nest egg to retire on. But when the prices started to crater, all of a sudden the equity was gone and they had to pay back these debts, so they're in double trouble.

MORALES: Is part of the problem, as well, that the mortgage rates got so low that people were refinancing, refinancing, refinancing to the point that you keep putting off your debt?

Ms. CHATZKY: That's right . And when you refinance later in life, you really have to look at taking out a shorter-term loan. You'll still save money on interest, but you don't want to stretch out those monthly payments till you're 70 or 80 years old.

MORALES: Other big problem, of course, people still not saving enough for retirement. We're seeing 401(k) accounts completely being wiped away.

Ms. CHATZKY: Right. Most people in this country, the vast majority do not have what it need -- what they need to retire on. And a big problem is that many people just don't know how much they need to retire on. Only about half of all adult Americans have actually run the numbers.

MORALES: Mm-hmm.

Ms. CHATZKY: So if you haven't done that, there's a really good website, choosetosave.org, where you can just go and do the calculations so that you'll know.

MORALES: And that's a big question, because a lot of people think, well -- and they've heard that, 'In order to maintain the lifestyle that I have now, I've got to continue to bring in that same amount of money when I retire.' But you really should be trying to think about living on less, right?

Ms. CHATZKY: Well, not necessarily.

MORALES: Not necessarily?

Ms. CHATZKY: There was this old rule of thumb that when you retired, you would only need 70 to 80 percent of the money that you were earning now.

MORALES: OK.

Ms. CHATZKY: It's not true, because not only are we living longer, we're living healthier. So a 65, 70-year-old retiree doesn't just want to garden anymore. They want to travel, they want to start new businesses.

MORALES: Mm-hmm. See the world, get out there.

Ms. CHATZKY: They want to do things, and that costs money . So you really do need to put away at least 100 percent, if not more, of what you've got. And then there's health care , which is the big, big wild card, because once you get into your 80s, 85, 90, your health care expenses can cost six figures, not including your retirement nest egg.

MORALES: All right, so some quick tips you say is, first, to think about downsizing.

Ms. CHATZKY: Now, not later.

MORALES: Now.

Ms. CHATZKY: Because if you can downsize earlier, you can free up some cash to save.

MORALES: All right. You also say if you can afford to do it, put off your retirement for a bit, delay it?

Ms. CHATZKY: Every year you manage to not retire, money can stay in those 401(k)s and grow. Plus, delay Social Security every year after 62 actually adds about 8 percent to the money that you'll bring in each year from age 62 to 67.

MORALES: Very beneficial.

Ms. CHATZKY: That's a big deal .

MORALES: That's huge. OK. And then finally, you say, if you can afford the time, look for a part-time job, as well. That brings in a little extra spending money .

Ms. CHATZKY: Again, you're just trying to leave the money in the retirement accounts and let it grow, and if you can earn some money , it'll keep you young, as well.

MORALES: Yeah.

Ms. CHATZKY: We know about two-thirds of retirees are working, and a lot of them are just doing it because they want to.

MORALES: Gives you something to do.

Ms. CHATZKY: Absolutely.

MORALES: There you go. Jean Chatzky , thanks so much.