A sampling of studies done in 2002 on boomer and/or pre-retirement planning issues

In January, Allianz Life Insurance Company of North America, Minneapolis, published results of two surveys showing that the majority of baby boomers and generation X-ers say their financial well being is a higher priority than their mortality. The surveys covered 800 consumers in 2001 and 400 consumers in 2002, respectively, all in the 25 to 45 age group. Further, it found that, in event of a serious financial setback, 58% believed they would need financial assistance after less than six months.

In May, a researcher from the Employee Benefit Research Institute, Washington, D.C., warned that it is not clear how boomers are going to pay for their retirement. Citing new pension plan participation data from the U.S. Census Bureau, EBRI senior research associate Craig Copeland said that even among U.S. residents making at least $50,000 in 1993 dollars, in 1998, 25% were not participating in a pension plan. The nation has to get serious about planning for the retirement of baby boomers, he concluded.

In July, AIG SunAmerica, Los Angeles, a member of American International Group, said a study it had commissioned found that traditional notions of retirement now reflect a lot of diversity in retirement lifestyle and needs. Conducted by Harris Interactive and Dr. Ken Dychtwald, a gerontologist, it polled 1,003 people age 55 and up. While 27% expect to be too active in retirement to be bored and 19% predict they will be comfortably content, the survey said the remaining 54% worry about, or anticipate problems with, their future finances.

In August, The Economic Policy Institute, the Washington, D.C., nonprofit think tank, injected some concern into the discussion when it reported that the stock market bubble burst early in this decade has “left the average family facing the prospect of having only 43% of the income they need for an adequate retirement.” Further, it reported that the ratio of household debt to income grew from 72% at the end of 1992 to 83% by March 2001, and said “it will take the average household over 30 years to recover the wealth lost in 2000 and 2001.”

In September, ING US Financial Services, Atlanta, came to a similar conclusion. A survey it commissioned of 200 people aged 50 to 70, having $100,000 to $500,000 in investable assets, found that 75% either do not understand, or havent yet considered, how to plan successfully for the withdrawal of their retirement savings or to maximize their available options. Conducted for ING by KRC Research, this survey also found that 69% have no plan in place for their “retirement paycheck.”

In October, Manulife USA, Boston, released survey results that reinforced concerns about boomer finances. In a telephone survey of 400 U.S. workers over age 21, this unit of Manulife Financial Corp., Toronto, found that, while 96% dreamed about having a comfortable retirement, only 24% felt they had set aside enough money to be on track for that. In fact, only 25% believed they had set aside enough to pay for their childrens college education.

In November, a study done by Harris Interactive for Transamerica Center for Retirement Services, Los Angeles, found that a disconnect exists between small business executives and their employees regarding retirement issues. For example, almost three-quarters of employers said they believe that employees prefer not to think about retirement until they near retirement age, but only three in 10 employees said that this was true of themselves.


Reproduced from National Underwriter Life & Health/Financial Services Edition, December 8, 2002. Copyright 2002 by The National Underwriter Company in the serial publication. All rights reserved.Copyright in this article as an independent work may be held by the author.