As the economy continues to slide, boomers feel less confident that their retirement savings will last long enough once they stop working. Moreover, few seem to know what to do about it, concludes a new study by the Longevity Alliance, Washington.
The research found that 56% of all boomers say they are less sure than they were 3 months earlier that their savings will last them through retirement.
Of boomers with retirement savings, 71% described themselves as “less confident” overall, with 35% being “somewhat less confident” and 36% saying they are “much less confident.”
Despite their apprehension about their financial future, few boomers have done anything about diminished retirement savings, or even plan to do anything, Longevity Alliance found. Only 39% of those with retirement savings have changed or plan to change their retirement savings as a direct result of the current economic conditions. Of those with savings who have made a change or plan to, 43% say they would seek the advice of a financial advisor or retirement planning professional.
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“Baby boomers know the train is coming, but they’re frozen on the tracks,” commented Steve Zaleznick, president of Longevity Alliance. “Unfortunately, too many are unsure of the best steps to take to guarantee that their money lasts through retirement. In uncertain economic times like these, knowing what to do and when to act is critical, and seeking the advice of a professional can be extremely reassuring. There is ‘no one size fits all’ answer, so individualized professional advice can be the key to a sound financial future.”
The survey found clear preferences among boomers who plan to change their retirement savings strategy. Seeking advice from a financial advisor or retirement planner was the top response, cited by 43%, followed by reallocating funds from stocks to more conservative investments (31%), investing in value-priced stocks (20%), buying long term care insurance (13%) and purchasing an annuity (12%).
Boomers reviewing their retirement preparation must look at the full scope of their financial health, including readiness for such critical expenses as health care and long term care, and not just their savings, Zaleznick observes.
“Life expectancy is increasing, health care costs are skyrocketing and investment returns are unpredictable,” he says. “There is no better time to take a holistic and honest look at retirement readiness.”
The survey found clear differences in outlook toward retirement between men and women. For instance:
o Among adults of all ages, 78% of men have retirement savings, vs. 70% of women.