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Retirement Planning > Retirement Investing > Income Investing

Americans’ 4 Biggest Retirement Investing Worries Now: Survey

By Michael S. Fischer

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Americans are feeling downbeat these days, worried about a possible recession and how their retirement income will fare if taxes should increase in the future, according to the third-quarter market perceptions study from Allianz Life Insurance Company of North America.

The good news: Advisors can do much to lessen their clients’ worries. The bad news: They are likely to get fired if they don’t. Specifically, nearly three-fourths of respondents said they would look for another advisor if theirs did not help them manage taxes in retirement.

“A change in taxes can significantly affect a portfolio if the investor has not incorporated tax strategies into a financial plan and diversified across tax categories, according to Kelly LaVigne, vice president of consumer insights at Allianz Life. 

“For a goal like retirement, you want to diversify your assets across a spectrum of long-term capital gains, regular income and non-taxable income,” LaVigne said in a statement. “This strategy, along with incorporating strategic tax deferral will help achieve some control over the amount or timing of taxes you will pay.”

For its study, Allianz Life conducted an online survey in August 2023 with a nationally representative sample of 1,005 adult respondents. 

Here are four things that more than half of respondents said they were worried about:

4. Recession: 55%

Concerns that a major recession is just around the corner have trended downward since last year. Even so, many Americans are holding more money in cash against this possibility — more than they should, according to Allianz Life. Millennials in particular worry about being laid off in an economic downturn, with 57% saying they have more money in cash.

3. Inflation: 70%

Concerns about inflation have come down over the past year. In the second quarter, 77% of respondents said they expect inflation to get worse over the next 12 months.

2. Retirement income: 72%

Many Americans worry about retirement income from tax-advantaged sources, saying they cannot count on Social Security benefits when planning retirement income. Seventy-nine percent of respondents expressed concerns about the future of Social Security and Medicare.

1. Higher taxes in retirement: 72%

Americans worry that higher taxes in the future will affect their retirement income from tax-deferred accounts such as a 401(k) or IRA. Survey respondents want help to reduce tax risk — so much so that 84% of Gen Xers, 77% of millennials and 67% of baby boomers said they would stop working with their current financial advisors if they do not help effectively manage taxes on retirement income. 

Michael S. Fischer

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