More than one-third of Baby Boomers surveyed said they expect Social Security to be a “major source of income in retirement.” However, only one in four have confidence the system will have money to pay benefits throughout their retirement; nearly 40% were not at all confident, according to the latest MFS Investing Sentiment Survey.
Most investors recognized the importance of personal savings and investments in funding their retirements, ranking it higher than all other sources cited. Among Baby Boomers, who at the median are just eight years away from retirement, only 12% have $1 million or more saved in retirement accounts, and the median balance was $314,000.
When asked how they plan to make up for any financial shortfall in retirement, the most popular answer among all investors was to cut back on spending (62%). Working part-time in retirement ranked second (42%), followed by delaying retirement (23%). Trying to increase the amount of money saved (18%) and taking more investment risk (9%) ranked lower among their choices.
Among major concerns cited by investors as to what may impede their ability to retire comfortably, half cited a significant rise (10% or more) in health care costs. Only a deep recession in the U.S. economy or a substantial cut in Social Security benefits ranked higher among their concerns.
Respondents in general were far more likely to say they have adjusted their lifestyle to stay healthy than that they saved more for emergencies or increased their health care coverage. Baby Boomer respondents were far more likely to have adjusted their lifestyle (63%) than to have saved more for emergencies (44%).
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