Following a dramatic uptick last year in retirement savers’ confidence in their retirement preparedness, confidence remained relatively stable in 2016, according to State Street Global Advisors fourth annual global retirement confidence survey.
According to the survey of 1,089 respondents in the United States in May 2016, 52% said they are “extremely” or “very” confident they will meet their retirement goals. In 2015, 51% said the same, compared to only 35% in 2014 and 21% in 2013.
The 2016 survey also includes responses from 1,038 individuals in the United Kingdom and 690 in Ireland, where confidence remains lower at 36% and 22% respectively.
The total 2,817 respondents include retirement savers, ages 22 to 70, who were working at least part-time and participated in retirement savings plans/schemes.
In this year’s survey, SSGA introduced a financial wellness index to assess a broader picture of participants’ financial lives. This includes insights into the sufficiency of their financial resources to meet their needs and obligations, the manageability of their debt, overall sense of financial stress and their ability to deal with financial emergencies.
“The introduction of the wellness index gives us a more complete view into participants’ perceptions and feelings about their financial life. While confidence can provide a signal of an employees perceived retirement future, the wellness index gives us a picture of their life today,” said Fredrik Axsater, global head of SSGA Defined Contribution, in a statement.
When asked simple questions about their overall financial situation, at least half of the participants in each country say their overall financial situation is “fine,” as opposed to “thriving” or “a mess.”
To capture an overall financial wellness score, SSGA created a statistically validated index of 14 variables, which ranged from feelings and perceptions (stress, control) to more direct questions about debt management, emergency savings, health costs and retirement savings.