While retirees remain more confident than workers, with a third (32%) very confident and another 44% somewhat confident that they will have enough money to live comfortably throughout retirement, retirees are less likely than in 2017 to feel confident in their ability to handle basic expenses in retirement as well as medical expenses, according to the just-released 2018 Retirement Confidence Survey.
The 28th annual survey, conducted by the Employee Benefit Research Institute and the independent research firm Greenwald & Associates, measured worker and retiree confidence about retirement.
The 2018 survey of 2,042 Americans was conducted online Jan. 3 through Jan. 16. All respondents were 25 or older, and the survey polled 1,002 workers and 1,040 retirees.
The share of workers who feel very confident in their ability to live comfortably in retirement remains low at just 17%, but another 47% are somewhat confident, the survey found. Combining those that are very and somewhat confident, workers appear to be more confident in retirement than they were in 2017.
Retiree Confidence Slides
Retirees’ overall confidence is declining, but confidence in being able to afford medical and long-term care expenses in retirement is down significantly. Also, retirees’ confidence that Social Security and Medicare will continue to provide benefits equal to what retirees receive today has decreased.
More than four in 10 retirees report that their health care expenses in retirement are higher than they expected, and another one in four say long-term care costs have been higher.
Other factors not measured in the survey may also be dampening retiree optimism, such as low interest rates. As in the past, two out of three retirees reported that they aim to maintain or continue to grow their asset level in retirement. That said, these retirees report the value of their assets is largely what they would expect.
Workers With 401(k) Plan More Confident
Workers’ “very positive” attitude about their workplace defined contribution plans is likely impacting their overall retirement confidence. The survey found that 76% of workers with a DC plan are confident in having enough for a comfortable retirement versus 46% without such a plan.
More than four in five workers with a DC plan report being “very or somewhat” satisfied with the plan overall, and with the investment options available to them.