Boomer Expectations for Retirement 2015
Boomers’ Confidence in Secure Retirement Sinks to Five-Year Low IRI Study Finds Retirement Confidence Plunging Even as Boomers’ Financial Expectations Are Improving WASHINGTON, D.C.
– The Insured Retirement Institute (IRI) today released a new research report that found Baby Boomers’ confidence in having sufficient savings to last throughout retirement has dropped to a five-year low. Declining each year since 2011, the first year this study was conducted, the report found only 27 percent of Boomers are highly confident their savings will last. Despite the drop in confidence, 44 percent of Boomers expect their financial situation to improve during the next five years, up from 32 percent in 2012.
“These numbers suggest that uncertainty is creeping in, and more Baby Boomers are doubting their ability to make their savings last,” IRI President and CEO Cathy Weatherford
said. “Many Boomers have witnessed their last payday or are quickly approaching the day their final paycheck arrives. Even with financial outlooks improving, there appears to be some second guessing when it comes to their retirement security and making ends meet. Unfortunately, the reality is few Boomers can be absolutely certain their savings can last 20 to 30 years in retirement.” Other key findings from the report:
- During the past year, nearly a quarter of Boomers reported experiencing difficulties paying their rent or mortgage, and 19 percent stopped contributing to a retirement account.
- Only 19 percent of Boomers have $250,000 or more saved for retirement, while four in 10 Boomers report having no savings for retirement.
- In the past year, 24 percent of Baby Boomers postponed their plans to retire. About three in 10 Boomers, 28 percent, expect to retire at age 70 or later. In 2011, only 17 percent of Boomers expected to retire at age 70 and beyond.
- A quarter of Boomers are confident in their financial preparations for retirement, 28 percent believe they will have sufficient savings to cover medical expenses in retirement, and only 19 percent believe they will be able to cover any long-term care needs.
- More than half of Boomers, 55 percent, expect to budget income in retirement for travel and leisure activities. Among Boomers with less than $250,000 dollars saved for retirement, 40 percent expect to budget retirement income for these activities.
- Nearly six in 10 Boomers, 58 percent, have made no preparations to plan for future cognitive issues. Among those that have, the most common preparations include documenting financial affairs and recording their wishes.
- Boomers who own annuities are more likely, by more than two-fold, to be highly confident that their savings will last throughout retirement, compared to Boomers without an annuity.
- Nearly nine in 10, 86 percent, of Boomers who plan for retirement with the help of a financial professional say they are better prepared as a result of their advisor’s help.
The IRI study is based on a survey of 803 Americans aged 52 to 68. The report was released during a conference call with reporters to open National Retirement Planning Week® 2015. The annual campaign promotes and encourages comprehensive retirement planning.
The entire report, “Boomer Expectations for Retirement 2015,” is available HERE in PDF format or read below.