The New Retirement Mindscape 2012 City Pulse index examines the 30 largest U.S. metropolitan areas to determine where consumers are the most prepared for and confident about retirement, and tracks national and local retirement trends over time. Hartford-New Haven, Connecticut, (No. 1), San Diego (No. 2) and Minneapolis-St. Paul (No. 3) claimed the top three spots on the third annual index while Washington, D.C., (No. 30), Charlotte, North Carolina, (No. 29) and Indianapolis (No. 28) ranked lowest.
Several things set apart the top-ranked metros. Residents of Hartford-New Haven, San Diego and Minneapolis-St. Paul are significantly more likely to say they are making financial preparations, including setting aside money for retirement, determining how much they need to save and consulting with a financial adviser. Perhaps as a result, they are also much more likely to feel on track and financially prepared for retirement.
In top-ranked Hartford-New Haven, three-quarters (75%) of residents say they have set aside money for retirement, compared with 63% of people nationwide. Nearly half (49%) report feeling on track for retirement—the most of any metro—and a sentiment expressed by significantly fewer consumers across the U.S. (37%).
However, despite the efforts they have made from a financial standpoint, residents of these areas are only on par with the rest of the nation with regard to planning for the activities they would like to pursue during retirement—a fact that may leave them less prepared than they actually feel. In fact, in third-ranked Minneapolis-St. Paul, where residents report the highest levels of financial preparation, only 18% say they have given a lot of thought to where they might live in retirement and how they plan to rest and relax.
While the story is not as positive for the bottom-ranked metros, it may not be as grim as it initially seems. Indianapolis and Washington, D.C., are on par with the national average in financial preparation, while Charlotte scores just slightly below. However, residents of these metros report a significant lack of confidence in their ability to reach their retirement goals.
Issues that may affect millions of retirement plans are expected to be heavily debated during the upcoming election. The Ameriprise survey found a majority of consumers say candidates' positions on health care (60%), Social Security (55%), taxes (53%) and Medicare (52%) are very likely to influence their vote—while 41% note unemployment. Similarly, more than one-quarter cite changes to Social Security (29%) and health care costs (26%) as the issues most likely to jeopardize their retirement plans.
Retirement status appears to influence how strongly people feel about these issues. While candidates’ positions on health care are frequently cited as a deciding factor for both retired and non-retired Americans, significantly more retirees say this topic is very likely to influence their vote (71% versus 55%).
Americans’ focus on health care may be for a very poignant reason as health concerns appear to force many people into an early retirement. Among retirees who left the work force earlier than expected, 46% say they did so because of a health issue, followed by a job setback (31%) or because they were financially capable (11%).
Whether because of the economy, uncertainty over the upcoming election or other reasons, peoples’ views on the traditional retirement age also appear to be changing. While the vast majority of retirees (83%) say they were under age 65 the day they left the work force, many Americans expect to work much longer. Only 20% of workers say they plan to retire before age 65 and more than one-quarter (26%) say they plan to remain in the work force as long as they're able.
More information and the complete rankings are available at http://newsroom.ameriprise.com/research+studies/retirementmindscape2012.htm.