All Worry About Retirement
Whether Baby Boomers, Generation X or Millennials, Americans of all ages worry about having enough money to fund their retirement, according to research by the Transamerica Center for Retirement Studies.
Forty-five percent of Baby Boomers expect their standard of living will decrease in retirement, 83% of Generation X think their generation will have a harder time achieving financial security than their parents have or did, and only 18% of Millennials are very confident about their future retirement.
Sixty-one percent of workers say they have not fully recovered from the Great Recession, 13% have not started to recover, and 7% think they may never recover. Seventy-seven percent of workers think that Social Security will no longer exist when they retire, only 51% of workers think they are building an adequate nest egg, and 65% think they could work until age 65 but still have too little saved to meet their needs in retirement.
“Today’s workers are grappling with retirement security and are challenged by the wobbly three-legged stool composed of employer-sponsored retirement benefits, Social Security and personal savings,” says Catherine Collinson, president of the center, in Los Angeles. “Amid retirement savings shortfalls, American workers are attempting to prop up our system’s three-legged stool by adding a fourth leg: work during retirement.” The survey found that 38% of workers expect to follow that course.
Sixty-six percent of Baby Boomers plan to or are already working past age 65—or expect to never retire. Eighty-seven percent of Boomers expect Social Security to fund some of their retirement needs, and 34% expect it will be their primary income source. Seventy-eight percent believe retirement accounts or other savings and investments will fund their retirement, but only 34% say they have a traditional pension plan.
The average household savings combining of all of its retirement accounts is $147,000. Transamerica notes that the average balance may be low because 401(k) plans were introduced when Boomers were already mid-career.
“Baby Boomers are the generation that has rewritten societal rules at every stage of their life,” Collinson says. “Now, Baby Boomer workers are redefining retirement by planning to work until an older age than previous generations. Baby Boomers’ vision can be achieved only if they are proactive about staying employable and if employment opportunities are available to them. As part of their retirement planning, Boomers should create a Plan B if retirement happens unexpectedly due to job loss, health issues or other intervening circumstances.”