Americans have lost confidence in their ability to afford retirement.
According to the 2011 Retirement Confidence Survey by the Employee Benefits Research Institute (EBRI), 27 percent of workers — the most ever in the two decades since the survey began—say they are "not at all confident" about having enough money to live comfortably in retirement.
Reinforcing that trend, the percentage of workers saying they are "very confident" ties with 2009 at 13 percent—the lowest rate ever measured.
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Jack VanDerhei, EBRI research director and co-author of the report, said in a press release, "Many systemic conditions are forcing Americans to redefine retirement … high unemployment rates, government fiscal crises, rising health care costs, lower investment returns, a surging older population putting pressure on Social Security and Medicare, and longer life expectancies."
A COUNTRY Financial survey indicated that Americans who have sought professional retirement advice have more confidence in their retirement outlook. Only 8 percent of people who sought professional advice are unsure how much money they will need in retirement.; this number rises to 21 percent for those without professional advice. Additionally, 74 percent of those who received advice are confident in their current retirement savings plan, while just 48 percent of those without professional advice say the same.
Other findings of the EBRI survey include:
- Roughly a third of both workers and retirees said they had to dip into their savings last year to pay for basic expenses. Significantly, those with retirement savings—such as a 401(k) or an individual retirement account (IRA)—were far less likely than those without these accounts to tap into their savings.
- Many people do not plan or save for retirement. Well over a third (42 percent) say they determined their retirement savings need by guessing. Seventy percent say they are a little or a lot behind schedule in planning and saving for retirement.
- More than half of workers say they have less than $25,000 in total savings and investments, excluding their homes.
Twenty percent of workers say they now intend to retire at an older age than they had planned. But 45 percent of current retirees say they retired earlier than they intended, mainly because of a health problem or disability.
The annual Retirement Confidence Survey is conducted by the EBRI. Full results are on the EBRI website at www.ebri.org.
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