People are overly confident they will be able to continue their current lifestyles into retirement. Unfortunately, according to the Employee Benefit Research Institute’s 2015 Retirement Confidence Survey, most people who are confident do not have the savings or income to back up that confidence.

The 25th annual survey found that people who have a retirement plan of some kind, whether it is a defined contribution, defined benefit or IRA, are more confident about their ability to afford retirement. That figure has rebounded from the record lows experienced after the market crash of 2008.

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Twenty-two percent of the 2,000 survey respondents said they are now very confident they will be able to retire comfortably, up from just 13% in 2013, while an additional 36% are somewhat confident. The survey found that only 24% are not at all confident, down from 28% in 2013.

Those who had a retirement plan were more confident than those without one. In 2015, 28% of those with a plan were confident in their ability to retire comfortably, compared to 14% in 2013. Twelve percent of those retirees without a plan said they were very confident in their ability to retire, compared to 9% in 2014 and 10% in 2013, the study found.

More people expect to work longer to make up for their lack of retirement preparedness, according to Mathew Greenwald of Greenwald & Associates, which helped conduct the survey. Twenty-six percent of those surveyed said they expect to work to age 70 or beyond, which is “almost triple the 1991 level,” Greenwald said. Those who expect to work until they are age 65 to 69 also went up from 2% in 1991 to 10% this year.

Only 25% of individuals expect to retire before age 65.

The disturbing thing is that most people who expect to work longer won’t be able to, Greenwald says.

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“Half of the retirees we interviewed didn’t work as long as they planned to,” he added. “ Multiple factors forced them to leave the labor force before they wanted to.” Health problems, disability or problems with an employer were many of the factors that forced them into retirement early. Many people don’t have the new skills that are being required at their jobs and are forced out.

“The age of retirement is going up, but stubbornly slowly. There is an important lesson here. Don’t put off saving for retirement because you hope to work into old age,” Greenwald said. “Even if you hope to work longer, don’t count on that working out.”

One spot of good news to come out of the survey is that people are doing a better job of managing their debt. Only 13% of workers surveyed said debt was a problem, compared to 20% a year ago. Among retirees, 9% described debt as a major problem, down from 16% a year ago.

“People are more uncomfortable about being in debt than being behind in saving for retirement,” he said.

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Many workers underestimate what they will need in retirement for basic expenses, medical care and long-term care expenses. The percentage of workers who are very confident in their ability to pay for basic expenses rose to 37%, up from 29% in 2014. The number of workers who believe they will have enough to pay medical expenses in retirement jumped to 18% in 2015, up from 12% in 2011. Fourteen percent of workers were confident they could pay their long-term care expenses compared to 9% in 2011.

When asked why they don’t think they are saving enough for retirement, half of workers cited cost of living and day-to-day expenses, but 69% said they could save $25 a week more than they are currently saving in retirement by cutting back on things like fast food, gourmet coffee and items from the vending machine, Greenwald said.

“None seemed particularly essential. Saving for retirement would not impose a hardship and would improve nutrition,” Greenwald said. 

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