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Notes on Retirement
Americans’ Rising Retirement Confidence Aside, Opportunities for Planners Abound

Americans’ Rising Retirement Confidence Aside, Opportunities for Planners Abound

Just 35 percent of workers and 29 percent of retirees say that they have talked with a professional financial adviser about retirement planning.

What are Americans thinking about retirement planning and getting advice from professionals?

Not much, according to the new edition of the longest-running national survey of public attitudes about retirement confidence. The 25th annual Retirement Confidence Survey (RCS) was issued Tuesday and it reflects a broad disconnect between what workers think about their retirement prospects and the underlying fundamental realities.

The survey, conducted by Employee Benefit Research Institute, found a second consecutive annual jump in the percentage of workers and retirees in an upbeat mood about their retirement finances.

The percentage of workers who are "very confident" about their ability to achieve a comfortable retirement doubled compared with 2013 - but the survey showed little improvement in the fundamental ingredients of successful retirement planning. In a majority of households, the amount saved for retirement remains shockingly low and many lack even a rudimentary understanding of how much they need to sock away.


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You can get my take on the broad findings here. But the RCS also offers insights about public attitudes and behaviors about planning for retirement - and getting professional advice.

For example, just 35 percent of workers and 29 percent of retirees say that they have talked with a professional financial adviser about retirement planning (see chart above).


More Key Survey Findings

  • Less than half (48 percent) of workers say they or their spouse have ever tried to calculate how much money they will need to have saved to live comfortably in retirement. That figure hasn’t changed much in recent years. Higher income, higher-educated households are more likely to have tried to calculate a number, as do those who have a retirement account of some type.

  • Among those who do try to come up with a number, 39 percent said they took a guess - literally. Just 22 percent asked a financial adviser; 10 percent used an online calculator.

  • Sixty- five percent said they will need $250,000 or more in savings to retire comfortably.

  • Getting investment education and advice from online providers draws tepid interest. Four percent of workers are very interested, and 22 percent are somewhat interested. Among retirees, 73 percent are completely uninterested.


People expect to work longer - 81 percent say their expected retirement age has increased. But there’s still a big gap between expectations and reality on retirement timing. Fifty percent of workers leave the workforce earlier than planned, citing hardships ranging from health problems or disability (60 percent), changes at their employer or needing to provide care for a spouse or other family member (22 percent). Some also mention positive reasons for retiring earlier than expected - being able to afford it (31 percent) or wanting to do something else (17 percent)

The RCS also offers insight on changes people make just before retirement. Forty percent of retirees with savings of at least $50,000 say they worried about a stock market drop just before retirement, and 41 percent responded by making adjustments to the way their money is invested. Half shifted to more conservative allocations, and 16 percent moved to income-producing investments. Nine percent changed the company or adviser handling their money.

Finally, the survey included a question about longevity insurance - a relatively new type of deferred income annuity that has been gaining traction. Eight percent of workers indicated they are very interested and 30 percent said they are somewhat interested. Interest among retirees is very low, with just two percent saying they are very or somewhat (8 percent) interested.

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