If you're like many Americans, you may expect to enjoy a comfortable retirement, however you probably haven't taken the necessary action to turn those hopes into reality.
The Retirement Confidence Survey (RCS) is the country's most established and comprehensive study of the attitudes and behavior of American workers and retirees toward all aspects of saving, retirement planning and long-term financial security. The findings from a recent RCS indicate that many Americans' retirement expectations are like a piece of Swiss cheese—full of holes.
It seems that the majority of individuals fail to accurately estimate the amount of savings they will need to live comfortably once they retire. Here are some of the survey results:
- 68% of current workers say that they have accumulated less than $50,000 in retirement savings.
- Nearly 58% of current workers say they (and their spouse) do not expect to receive any health insurance from their employers when they retire. Recent EBRI research shows that individuals age 55 who live to age 90 would need to have accumulated $210,000 (by age 65) to pay for insurance to supplement Medicare and out-of-pocket medical expenses in retirement.
- 66% of current workers think there is a chance that they will live until age 90—or spend 25 years in retirement, assuming they retire at age 65. These findings suggest many workers may not be planning and saving enough to finance the full amount of time they expect to spend in retirement.
- 14% of current workers said they thought they would need less than 50 percent of their pre-retirement income to live comfortably in retirement. Another 36 percent expected to need 50 to 70 percent. However, 62 percent of current retirees say their income is 70 percent or more of their pre-retirement income.
- Nearly 59% current workers said they hope to have a retirement standard of living equal to or higher than their working years. But when current workers were asked if they or their spouse have calculated how much money they will need to retire comfortably, nearly six in 10 (58 percent) said no.
Saving for retirement takes careful financial planning.