The survey finds that many systemic conditions are forcing Americans to redefine retirement, such as high unemployment rates; government fiscal crises; rising health care costs; lower investment returns; a surging older population putting pressure on Social Security and Medicare; and longer life expectancies.
“Americans are beginning to recognize the level of savings needed for a comfortable retirement. Now it’s critically important to take steps to improve the chances they’ll have enough,” said Greg Burrows, senior vice president of retirement and investor services at The Principal, in a statement. “Research shows even simple actions, like calculating how much is needed for retirement, increases savings. Creating a plan and working with a financial advisor can also help get savers on realistic paths to a secure retirement.”
Among other key findings in the 2011 Retirement Confidence Survey, available on the EBRI website at www.ebri.org:
- Roughly a third of both workers and retirees said they had to dip into their savings last year to pay for basic expenses. Significantly, those with retirement savings—such as a 401(k) or an individual retirement account (IRA)—were far less likely than those without these accounts to tap into their savings.
- Many people do not plan or save for retirement. Well over a third (42 percent) say they determined their retirement savings need by guessing. Seventy percent say they are a little or a lot behind schedule in planning and saving for retirement.
- More than half of workers say they have less than $25,000 in total savings and investments, excluding their homes.
- A significant number of workers (20 percent) say they now intend to retire later (at an older age) than they had planned. But almost half of current retirees (45 percent) say they retired earlier than they planned, mainly because of a health problem or disability.
The annual Retirement Confidence Survey is conducted by the nonpartisan Employee Benefit Research Institute (EBRI) and Mathew Greenwald and Associates.