Image: Where Americans expect their retirement income to come from.
When it comes to gauging retirement preparedness, do you have a good sense of whether your savings are on track to fund the retirement life you envision? Realistically assessing your progress on the road to retirement is a key step in achieving your goals. But it can be challenging to pinpoint an accurate target—and even tougher to predict the future.
Looking for some benchmarks? Follow along as we explore key findings of a national poll conducted by Kiplinger’s Personal Finance and wealth management firm Personal Capital. We surveyed 1,014 investors between the ages of 35 and 64, equally divided between men and women, to reveal some common measures of retirement readiness.
This is part two in our series “Are You Retirement Ready?”
Stay tuned for the fourth chapter, “Retirement Living: What Does Retirement Mean to You?”
But this week, we’re going to focus on retirement planning, and what our survey revealed are American’s biggest concerns when it comes to retirement.
What Do You Feel is the Biggest Threat to Your Future Security in Retirement?
When it comes to having enough money in retirement, most respondents are worried about high healthcare expenses. They’re also uneasy about the lack of a regular paycheck and fear running out of money as they age.
To help guard their nest eggs and bolster income, they acknowledge the importance of staying flexible when it comes to protecting retirement savings, paying off debt and exploring ways to add to income. These concerns are prompting them to consider defensive strategies like these:
- 72% Pay off a mortgage by retirement
- 47% Continue working during retirement
- 34% Relocate to lower expenses
- 30% Purchase a long-term care insurance policy (if they don’t already have it)
- 15% Acquire a reverse mortgage when eligible
Under 50s Take Action
Interestingly, views differ on some key aspects of future financial security among those who are under or over age 50. Our survey shows that people under age 50 appear to be stepping up their retirement preparation. To stay on course, in fact, our respondents are pursuing many options.
For example, those younger than 50 are more likely to say they’ll work as long as possible compared with those who are older than 50. Our results show that more under 50s contribute the maximum to their workplace retirement accounts, and they also put twice as much money into traditional IRAs each year. They’re also open to alternative ways to fund their retirement—nearly twice as many under 50s, for instance, would consider purchasing an immediate annuity vs. their older counterparts.
While a similar majority of both under 50s and over 50s say they have a long-term financial plan, more of the under 50s worked with a financial planner to create it (70% vs. 58%).
Where Can You Find Unbiased Advice?
A financial advisor can help you plan for the future and stay on track. As a first step, Personal Capital’s advisory team offers a free, no obligation portfolio review—it’s a great way to get an objective second set of eyes on your portfolio.
If you’re serious about your financial goals, what do you have to lose? It’s a complimentary perspective from a fiduciary who is legally obligated to put your interests first.