The Employee Benefit Research Institute, or EBRI for short, just released their 2016 survey results of 1000 workers and 500 retirees. The annual survey has been ongoing for a couple of decades now, so it provides a good indicator of where Americans are in regards to retirement confidence and thought process.
You can view the full survey brief here: https://www.ebri.org
My own conclusions after skimming through the charts and figures is that Americans are still on course for a rude retirement awakening.
21% of workers in 2016 are confident that they will be able to retire comfortably and 19% are not at all confident with the rest in-between, but 67% of current workers expect to continue working in retirement.
Compare the blue line (current workers) with the red line (current retirees). Either we are going to get used to seeing older people in the workforce, or a lot of people are going to be in for a rude surprise when they cannot find employment as they get older.
Looking at the Savings and Investments by age doesn’t exactly inspire confidence. The Baby Boomer generation is woefully underprepared for retirement with 1/3 of respondents claiming less than $25k in savings. That would probably cover 1-2 years of living expenses. Gen X and Y (Millenials) aren’t doing much better.
Married men seem to be the most motivated to save for retirement. Unmarried women don’t seem to have the same kick in the pants.
A whopping 23% have raided their retirement accounts for present day needs/wants.
I think the biggest threat to retirement in America is people simply burying their heads in the sand. They know that it is a problem, but it is easier to kick the can down the road instead of dealing with it right now. The problem is that developing a solid retirement takes time! Kicking the can down the road isn’t the answer!
What can be done to help avert a retirement crisis? Enroll in your employers 401k plan and/or setup an IRA. Workers enrolled in a plan had significantly more saved than workers not enrolled. Paying yourself first works!