Podcast Center
Video Center
Webcasts
Resource Center
Events
July 21, 2017 at 11:05 AM
Financial security is only one consideration for wealthy investors contemplating retirement, and not the most important one. They are more concerned about being emotionally prepared to retire.
A new survey by UBS Wealth Management Americas finds that this work-leaving anxiety is largely unfounded, with most wealthy retirees happier than they have ever been.
For its report, UBS said it revisited retirement concepts first introduced in a 2013 report titled “80 is the new 60.” The firm surveyed 2,028 affluent and high-net-worth investors (with at least $1 million in investable assets) in early June, including 475 with at least $5 million. It also conducted qualitative follow-up interviews with 94 respondents.
Beyond Financial Security
Two-thirds wealthy pre-retirees surveyed said they wanted to reach a certain asset level before they left work—in contrast to their less well-off counterparts for whom age is the retirement trigger, according to UBS. Forty-five percent of respondents set their retirement savings target at between $1 million and $3 million.
The vast majority of wealthy pre-retirees were confident that they had the financial tools and knowledge necessary for a comfortable retirement, and 89% said they would have enough money saved.
Another 89% knew where their retirement income would come from. Most reported that their retirement savings were in liquid assets, primarily held in traditional retirement accounts. They also held taxable investments, banking accounts and, to a lesser extent, real estate.
Seventy-four percent of respondents believed they knew how long their savings would last.
However, the survey findings showed that emotional anxiety eclipsed financial concerns when respondents assessed their retirement readiness. Sixty-four percent said they expected to miss their work schedule more than their salary.
Among other emotional concerns, they cited these:
- Adjustment to retired life: 59%
- Leaving work colleagues behind: 57%
- Experiencing an initial shock: 39%
- Losing a sense of purpose: 36%
- Filling the hours of free time: 34%
“Baby boomers have been known for ‘living to work,’ having been focused on their careers for so many years,” Paula Polito, client strategy officer of UBS Wealth Management Americas, said in a statement. “Even once they achieve financial security, their emotional attachment to work keeps many boomers on the job.
“Now, as many of them look toward retirement, they need to start ‘working on living’— figuring out how they will fill their time and find their purpose once they leave the workforce.”
