Investors Optimistic but More Conservative about Retirement Savings

Pre-retirees and retirees want to pay more attention to their investments and retirement plan, and trust a financial professional to help, according to a survey by Prudential Financial.

Following retirement savings losses during the recession, investors are re-evaluating their overall approach to retirement planning, according to the survey of Americans aged 45 to 75 with at least $100,000 in retirement savings. More than three-quarters (77%) of those surveyed said they will pay more diligent attention to their investments following the recession.

Nearly half (48%) are looking to the Internet for financial guidance, compared to 37% before the market decline; however, two-thirds said they would trust a financial professional for information and guidance on how to best manage their retirement savings and investments.

Survey respondents estimated they lost more than a third of their assets during the downturn, yet 62% said they think they can grow back the money they lost in their workplace retirement plans, and more than two-thirds of this group thinks it will be within five years, according to the survey.

Eight in 10 respondents acknowledged a need to start rebuilding their savings after the recession, and 73% of retirees said they are exploring new ways to grow their assets.

Conservative over Aggressive

Although most respondents are optimistic they can grow back the money they lost, they are still shying away from aggressive portfolios. Seven in 10 say that being too aggressive with investments is riskier than being too conservative, compared with survey results from two years ago when respondents were evenly split on the same question, Prudential said.

Other than investing conservatively, many have made other sacrifices to balance their investment losses, such as cutting back on spending (54%) and postponing retirement (41%).

In addition, two-thirds indicated they would likely pursue a solution that offered guaranteed income, and three-quarters said a product with guarantees for lifetime income, protection of principal, and opportunities to lock in market gains would be important or nice to have as part of their portfolio. Seven in 10 said they would put money back into the stock market if protected by such income guarantees.

Sixty-six percent said their preference for learning more about guaranteed income would be by talking to a financial professional.

Prudential surveyed 1,001 Americans.