Two-thirds of American workers are still trying to recover from the recession that began in December 2007 and ended in June 2009, according to a report released Thursday by Transamerica Center for Retirement Studies.
On a more optimistic note, 16% of workers surveyed said they had fully recovered from the recession, and 21% said the downturn had not affected them, up from 14% and 15%, respectively, in TCRS’ 2014 report.
Meanwhile, confidence in the future of Social Security isn’t exactly stellar, and for the first time, the wide-ranging survey asked respondents if they pictured work as their primary source of retirement income. Fourteen percent of younger workers did.
Harris Poll conducted an online survey in February and March among 4,550 full-time and part-time workers in for-profit companies. Respondents were U.S. residents and 18 or older.
Retirement confidence has eroded slightly since last year’s survey, with 59% of workers somewhat or very confident that they would be able to fully retire with a comfortable lifestyle, compared with 61% in 2014.
Not surprisingly, the level of household income influenced workers’ confidence, with 76% of those with household income of more than $100,000 somewhat or very confident of a comfortable retirement, versus 47% of those bringing in less than $50,000. Relatively few respondents of all income levels said they were “very” confident.
However, only a third of workers expected lower living standards in retirement, well below the 42% who had this expectation in the 2011 survey.
Workers most frequently said travel figured prominently in their post-retirement dreams. Relatively few cited pursuit of an encore career as their top dream.
Respondents’ chief concerns in retirement:
- Outliving savings and investments:44%
- Needing long-term care: 36%
- Social Security being reduced or ending: 36%
- Not being able to meet the family’s financial needs: 33%
- Cognitive decline: 26%
- Lack of adequate/affordable health care: 25%
No ‘Average’ American Worker
Demographics strongly influenced American workers’ readiness for retirement, the report found.
“With regard to saving and planning for retirement, there’s no such thing as an ‘average’ American,” TCRS president Catherine Collinson said in a statement. “Each demographic segment faces its own unique opportunities and challenges.”
Two-thirds of workers reported that their employers offered a 401(k) or other self-funded plan. However, access was greater for workers at large companies with more than 500 employees than at smaller operations. Only 24% of workers said they were offered a traditional company-funded defined benefit plan.
It’s not surprise that workers of different generations look forward to different retirement realities. Forty-eight percent of millennial workers in the survey and 40% of Gen Xers most frequently said they expected 401(k)s, 403(b)s and/or IRAs to be their primary source of retirement income, while 35% of baby boomers most frequently cited Social Security.