RIIA reports on retirement readiness

The more Americans and their financial advisors know about retirement savings habits, the better prepared they should be for retirement. To further that cause, the Retirement Income Industry Association conducted the first in a series of studies designed to help everyone prepare for retirement. The first report looked at retirement readiness by examining Americans’ wealth and relating it to their retirement income needs.

A key conclusion RIIA reached said 84 percentof American households have less than $200,000 in total financial assets, which, one study author noted, delivers less than $10,000 per year on a 5 percent return. For those about to retire, that $200,000 will allow them to live at about the poverty level. For younger workers, that $200,000 can become much more before retirement, which is why the study segmented the population into four groups: Starters (under 35), Builders (35-49), Preretired (50-64) and Retired (65 and up). The study further segmented the population by levels of financial assets: Wealthy (top 5 percent), Affluent (next 15 percent), Mass Market (next 50 percent) and Marginal (lowest 30 percent).