After almost a decade, many American workers are still recovering from the Great Recession, according to a recent survey.1 Most are focused on saving for retirement and have varying degrees of confidence they will be able to retire comfortably.
Just one in five (18 percent) of workers are “very confident” they are building a large enough retirement nest egg. The majority (59 percent) say they have not yet fully recovered from the Great Recession.
Many feel they should prepare in case retirement programs such as Social Security and Medicare are cut back. Three in four workers (77 percent) are concerned that Social Security will not be there for them when they are ready to retire. Instead, many expect to rely principally on their own savings and investments. Almost half of workers (48 percent) expect their primary source of income in retirement to come from personal savings including 401(k)s, 403(b)s, and IRAs (36 percent) and other savings and investments (12 percent).
Workers’ three most frequently cited retirement fears are “outliving my savings/investments” (48 percent), “Social Security will be reduced or cease to exist in the future” (44 percent), and “declining health that requires long-term care” (41 percent).
Many workers expect to retire after age 65 or never retire. The majority of workers (54 percent) plan to work past age 65 (40 percent) or do not plan to retire (14 percent). Only 22 percent of workers plan to immediately stop working at a specific point in time. Many plan to transition into retirement by either shifting from full-time to part-time (27 percent) or moving into a less demanding or more personally satisfying role (17 percent).
However, the majority of workers (62 percent) do not have a backup plan for retirement income if they are unable to work before their planned retirement, and only 26 percent cite that they have a backup plan. Studies show that many people retire earlier than they expected, most often for health reasons.
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1. The 19th Annual Transamerica Retirement Survey
This publication is designed to provide general information and is for discussion purposes only. The effectiveness of any strategy is dependent upon each individual’s facts and circumstances. This article does not provide legal, tax or account advice. Because of the possibility of human or mechanical error, the accuracy, adequacy, completeness or availability of any information is not guaranteed.