Working longer isn't the answer to longevity risk, according to "Longevity Risk and Reward for Middle-Income Americans," a new report by the Bankers Life and Casualty Co. Center for a Secure Retirement.
According to the report, 55 percent of middle-income Baby Boomers have saved less than $100,000 for retirement and 19 percent have saved less than $10,000. With figures such as those it is no surprise that 75 percent of middle-income Boomers expect to work in retirement.
For the project, the organization sampled 55 Americans between the ages of 55 and 75 who have an annual household income of between $25,000 and $75,000.
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It found that 87 percent of middle-income Americans 55 and older don't spend much time thinking about longevity. Most of these people don't discuss it. Only 50 percent of respondents said they discuss it with their doctor; 49 percent with their spouse and 21 percent said they have discussed it with a professional advisor.
The majority of middle-income Americans believe they will live to age 86, irrespective of gender, income or health and most believe that old age doesn't really start until age 78.
The survey also found that two-thirds of middle-income Americans feel that their life expectancy is out of their control. Sixty-five percent said genetics was the determining factor in how long they will live as compared to their own actions, such as eating right, 46 percent, exercising, 44 percent, or smoking, 37 percent.
Declining health is the main longevity concern for this demographic, nearly four times the concern of having an inadequate retirement savings or outliving their money.
To compensate for the possibility of outliving their income, 63 percent of middle-income Americans plan to reduce their own spending to deal with shortfalls in retirement income and resources, 41 percent would get a part-time job and one-quarter would sell their home.
Seventy percent of middle-income Americans age 55 and older report living comfortably within their budget and one in 10 admit to living beyond their means.
When developing a retirement savings goal, only 21 percent said they calculated a monthly retirement income goal number and only 13 percent determined a total savings goal number to reach.
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