More U.S. workers are confident about their retirement prospects relative to last year, according to the Employee Benefit Research Institute's 2016 Retirement Confidence Survey.
The 26th installment of the non-partisan, not-for-profit think tank's retirement confidence survey is the industry's longest-running account of retirement preparedness.
The number of workers “very confident” about their savings rate leveled off this year at 21 percent, down from 22 percent in 2015.
But the number of workers “somewhat confident” increased to 42 percent from 36 percent in 2015, and those “not at all confident” decreased to 19 percent in 2016, down from 24 percent last year.
While any improvements are no doubt welcome, this year's confidence survey shows glaring shortfalls in the country's overall state of retirement readiness, particularly among workers without access to a workplace retirement savings plan.
For workers reporting that they or their spouse have invested in an IRA or workplace defined contribution or pension plan, 74 percent are at least somewhat confident they will have enough savings to retire comfortably.
For those without access to a retirement plan, that number is only 39 percent.
More than half—or 57 percent—of workers without access to a retirement plan say they have little or no confidence in their ability to retire comfortably.
“Among those who are confident about retirement, it's overwhelmingly among those who have a retirement plan,” said Jack VanDerhei, research director at EBRI and co-author of this year's study.
Luke Vandermillen, vice president of retirement an income solutions at Principal, one of the 17 underwriters of this year's study, said the improvements in perceived readiness this year add a positive in light of recent market volatility.
“It's important to stay focused on the things you can control and keep the long-term in mind,” said Vandermillen in an email statement to BenefitsPro.
“Access to a retirement plan at work continues to have a big impact on likelihood to save,” added Vandermillen. “Eighty-eight percent of workers who are offered a retirement plan have saved compared to only 21 percent who don't have access to plan at work.
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Nick Thornton
Nick Thornton is a financial writer covering retirement and health care issues for BenefitsPRO and ALM Media. He greatly enjoys learning from the vast minds in the legal, academic, advisory and money management communities when covering the retirement space. He's also written on international marketing trends, financial institution risk management, defense and energy issues, the restaurant industry in New York City, surfing, cigars, rum, travel, and fishing. When not writing, he's pushing into some land or water.
