Are older workers on track for a comfortable retirement? They think they are — but they may be fooling themselves.
A new survey says two in three Americans who are less than a decade from retirement say they’re on track to meet their goals and maintain their lifestyle in retirement. Yet nearly one in two workers aged 51 to 64, and two in five workers 65-plus, report less than $250,000 in retirement savings.
That’s a far cry from what experts say they’ll need. Ideally, if you’re age 50 and earning $70,000 annually, you should have at least $280,000 saved for retirement. At 60, with a $70,000 annual income, your retirement savings target is $630,000.
So what’s the plan for meeting their retirement goals? Three in five say they plan to rely on their personal savings, Medicare and Social Security as pension plans vanish from the workplace. One in two say they plan to push back their retirement date.
Meanwhile, some are tapping into their retirement savings to meet today’s expenses. In the last year, one in three people aged 65 and older say they withdrew money from their long-term savings to meet short-term financial needs; about one in six aged 51 to 64 say they did the same.
And that has apparently taken a toll on romance. One in three married Americans say they’re talking more about money matters than their sex life.
The survey of 1,001 retirees and workers (two-thirds were 51 and older) with between $50,000 to $250,000 in assets (excluding real estate) was conducted by Bank of America to learn more about Americans’ financial concerns and behavior. It showed that, despite their professed optimism, respondents were less confident now than they were a year ago in some areas.
Among the greatest financial concerns for those 51 to 64:
- 89 percent say the rising cost of health care
- 81 percent say it’s outliving retirement savings
- 75 percent say it’s being able to afford the lifestyle they want in retirement
On the bright side, retirees were more apt to say their finances were under control than working adults, 48 percent versus 32 percent.
Photo credit: kenteegardin via flickr.com