Americans’ Top Financial Concern is Retirement Savings

However, only 33% are confident about their retirement readiness.

For 70% of Americans, saving for retirement is their top financial priority, a survey by The Standard found. This is followed by monthly expenses (57%), medical expenses (52%), support if a disability is incurred (52%) and mortgage/rent (49%).

“We found that saving for retirement outweighs other important priorities, such as ensuring employees have enough money for a roof over their head or medical expenses,” says Chris Dugan, director of retirement plan communications for The Standard. “Given its importance to employees, it’s crucial for advisers and employers to do what they can to help support their retirement readiness efforts.”

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According to the survey, only 33% of workers are confident about their level of retirement readiness. The Standard suggests that if a retirement plan is not already employing automatic features—automatic enrollment and deferral escalation—that it does so in 2019.

The survey found that 68% of employees of all ages support these features. For Millennials, it’s 70%; Gen Xers, 66%; and Baby Boomers, 64%.

“Employers should also consider a managed account service as the qualified default investment alternative, which offers annual automatic deferral rate increases that are customized to the needs of the individual,” Dugan says. “For most, this is just a 1% or 2% increase. But even a small additional increase each year can make the difference in making a specific retirement goal a reality.”

Roughly half of employees are not comfortable making retirement plan choices, and 55% are interested in the help of a professional.

Excitement About Living Longer Overshadowed by Retirement Worries

Nearly three-quarters (72%) of respondents to a TD Ameritrade survey indicated they do not believe Social Security will cover their spending in retirement, and 51% said they do not believe they’ll have more than enough money to cover their needs in retirement.

Despite optimism about a longer life span and the opportunities that may bring, most respondents to a TD Ameritrade survey are not confident they are preparing for retirement correctly.

While half of the respondents would like to retire by 60, just 33% expect to do so, primarily due to the need to save more (74%).

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Nearly three-quarters (72%) indicated they do not believe Social Security will cover their spending in retirement. In addition, six in 10 have or had no idea how much to save for life beyond 65 (the survey included those retired and those not yet retired); and 51% said they do not believe they’ll have more than enough money to cover their needs in retirement.

Those surveyed said they worry more about the health care costs and finances (43 and 35%, respectively) related to growing old than death (26%).

Asked how to prepare for a longer life span, 68% said reduce expenses to save more, while 53% said save more for retirement. Three in 10 replied “increasing income outside of job,” including 44% of Millennials, and 18% said “shifting to higher return/risk assets.”

The report of survey results is here.

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