An Ameriprise Financial study of the nation’s largest U.S. metro areas found that following Minneapolis-St. Paul, is Raleigh-Durham, Nashville, Sacramento-Stockton-Modesto and Seattle-Tacoma rounding out the top five. A news release said the last four slots were Charlotte at 27, Orlando-Daytona Beach-Melbourne, Indianapolis and Los Angeles in the 30th spot.
According to the announcement, the biggest similarity between the top-ranked metro areas is that their residents make retirement planning a priority, and not just from a financial perspective. While it was a tight race for the top spot on the index, Minneapolis-St. Paul, edged out Raleigh-Durham in part because Twin Cities residents approach retirement with more confidence, suggesting higher levels of emotional preparation.
Minneapolis-St. Paul scored significantly higher than the national average on nearly every factor related to retirement readiness, Ameriprise said. An impressive 83% of survey respondents say they have set aside money for retirement, compared to a national average of 69%. This may help explain why nearly half (48%) of Twin Cities residents report feeling “on track” for retirement and a third (30%) say they are “very confident” in their financial future.
“Our latest research allows us to take the pulse of each major metropolitan area to see where there is alignment – or significant discrepancies – in how people have planned for and feel about retirement,” said Craig Brimhall, vice president of retirement wealth strategies at Ameriprise Financial, in the news release . “In some cases, local economic conditions have had such a substantial impact on people that their levels of preparation and confidence appear a bit out of sync.”
A Different Picture in Los Angeles
In L.A., more immediate financial concerns may be taking precedence over retirement planning. More than a third (36%) of those surveyed say they’ve experienced a career setback or layoff in the past 18 months, and 22% report that they are currently unemployed but planning to return to work. This may help explain why 37% of its residents admit that they haven’t given much thought to preparing for retirement and only 57% have set aside money, Ameriprise said.
The sentiment is similar in Indianapolis, where a third (31%) of retirees say the economy has impacted their retirement plans, compared to a quarter (25%) of retirees nationwide, according to the news release. Here, just 42% of those surveyed have set aside money into their own savings or investments, and only 60% of people associate emotions like “happiness” and “optimism” with retirement.
The poll was created by Ameriprise Financial utilizing survey responses from 10,028 U.S. adults ages 40-75. The survey was conducted online by Harris Interactive from September 28 to October 11, 2010.
Metropolitan areas were scored based on responses to a national survey which measured consumers’ likelihood to have determined the amount of money they need to save for retirement and their actual saving habits. The index also takes into account if people have planned for a variety of activities during retirement and expressed confidence about achieving their retirement goals.(Cont...)
Based on composite scores, the 30 metropolitan areas surveyed are ranked on retirement readiness:
San Francisco-Oakland-San Jose