Retirement Stress Is Increasing

by Jerri Hemsworth | June 8, 2017 3:53 pm

Many California workers today are feeling stressed about retirement, and a new study indicated that many Americans are not taking steps to prepare for it. Those feeling stressed have lower levels of retirement confidence and are less likely to feel financially secure, according to the recent Retirement Confidence Survey by the Employee Benefit Research Institute (EBRI) and Greenwald and Associates.

The study revealed that finds that three in ten workers say they feel stressed about preparing for retirement. In addition, six in ten workers (61 percent) say they have saved for retirement, though just four in ten have tried to figure out how much money they will need in retirement (41 percent).

“I continue to be struck by the relatively small share of workers who do formal retirement planning,” said Lisa Greenwald, assistant vice president of Greenwald & Associates, and co-author of the report. “Use of a financial advisor increases with age and income, but just 23 percent of workers say that they have spoken with a professional advisor about retirement planning and only one in ten report they have prepared a formal plan for retirement.”•

Among the major findings in this year’s Retirement Confidence Survey:

Importance of a retirement plan: Workers who have a retirement plan, whether a defined contribution plan, defined benefit plan, or IRA, have saved more than those without a plan, have taken more steps to prepare for retirement and feel less stressed about retirement preparations.
Saving incentives: Nearly 3 in 4 workers (73 percent) not currently saving for retirement say they would be at least somewhat likely to save for retirement if contributions are matched by their employer. Approximately two-thirds of non-saving workers say they would be likely to save for retirement if automatic paycheck deductions with the option of changing or stopping them, at either 3 percent or 6 percent of salary, were used by their employer.
Financial wellness: Stress about retirement preparations and worry over personal finances at work are causing some workers to be less productive. Among all workers, majorities feel retirement, financial and healthcare planning programs would be helpful in increasing productivity.
Healthcare in retirement: Workers are far less confident than retirees about being able to afford healthcare in retirement. Roughly half of workers (54 percent) say they’re very or somewhat confident about being able to afford medical expenses in retirement (vs. 77 percent of retirees). Workers are also less confident than retirees that Medicare will continue to provide the same level of benefits that retirees receive today (38 percent of workers vs. 52 percent of retirees).

Source: 2017 Retirement Confidence Survey

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