Ameriprise Financial published its 2010 City Pulse Index on Tuesday, which ranks major U.S. cities on retirement preparedness, and found Minneapolis residents were most likely to be prepared for and confident about retirement.
The Index ranked each city's retirement preparedness and confidence, taking into account the emotional aspect. Although Minneapolis ranked third for preparedness, it beat Raleigh, N.C., for the top spot with a confidence ranking of one. Minneapolis scored "significantly higher than the national average on all but one factor," according to Ameriprise; residents fell below the national average in planning for how they'll spend their retirement years.
In Raleigh, residents are prepared financially, but they're also planning for how they'll actually spend their retirement; 79% said they have set aside money for retirement, and 80% are planning activities they'd like to pursue. Education is not likely to be one of them though; just 12% said they plan to "continue their learning and education during retirement."
The report blamed the economy for the lowest ranked cities' relative unpreparedness. In Los Angeles, the lowest ranked city overall, 36% of respondents said they've experienced a "career set-back" or layoff in the past 18 months. Twenty-two percent said they were currently unemployed but planning to return to work. Furthermore, residents said they will only need retirement savings for 16 years.
Retirees in Indianapolis, ranked 29th overall, also suffered from economic woes; 9% of retirees said they postponed retirement due to market conditions, and 10% retired early due to a layoff. Overall, 31% of retirees said the "economy had an impact on their retirement plans," compared with one-quarter of retirees nationwide. The city ranked 29th for preparedness and 28th for confidence.
Although Washington, D.C., ranked sixth in preparedness, the city was 29th in confidence. The city is second to Minneapolis in retirement savings; 80% of residents are putting money aside for retirement. In spite of that, 40% of respondents "expressed negative feelings" about retirement, and 27% said they are anxious about it. This could lead to some displacement in the future; 51% of respondents said they would stay in the city during retirement.