Americans are living longer and with an increased life expectancy, many will have an extra 30 years of retirement for which they need to plan. Respondents to a survey by T. Rowe Price had mixed emotions on whether these additional years were a positive or a negative.
More than half (55%) of respondents said an additional 30 years of life would be “both a blessing and a curse,” noting potential health issues during the later years may outweigh the benefits of living longer. Gen Xers (37%) were more likely to label it a blessing compared with Baby Boomers (29%).
Forty-five percent of respondents were skeptical about the idea of an extra 30 years of life, while 35% were optimistic and 26% were excited. Gen Xers (73%) were significantly more likely to say the “longevity bonus” would impact how they plan and save for retirement than Baby Boomers (62%). Both cited they would need to work longer in order to save more money.
In addition, the study found that generational differences exist as they relate to financial planning habits.
For example, the extent to which investors review their accounts intensifies with age. About 57% of 36 to 49 year olds said they reviewed their investment accounts at least once a month. That number jumped to 66% for investors in the 60 to 64 year age group. Gen Xers (43%) were also more likely than Baby Boomers (24%) to say online investment platforms and apps have changed the way they approach investing.
In addition, Gen Xers (82%) were more likely to say they could be doing more to prepare for their retirement than Baby Boomers (55%). For both groups, those who feel like they could be doing more cite not having enough money or time as reasons holding them back. Despite this, about 92% of respondents feel their ideal retirement is very (47%) or somewhat (45%) attainable.
The survey was held from December 15, 2016 to December 21, 2016, with a sample size of 2,001 Gen Xers and Baby Boomers with total investable assets of at least $50,000.
For the full report of findings, visit T. Rowe Price: Understanding Investor Attitudes Toward Retirement.