Comedian Chris Rock once joked that in life, people had two choices: Be married and boring, or single and lonely. Who's to say which path is right in achieving overall happiness, but recent research appears to show that when it comes to achieving retirement security, the "married and boring" route is the way to go.

According to a new fact sheet from the Insured Retirement Institute, two 401(k)s are better than one, as married baby boomers are much better prepared for retirement.

Married baby boomers are much more likely to have retirement savings and a retirement savings goal. More than eight in 10 married baby boomers (81.9%) report having retirement savings, and 55.7% have gone through the process of calculating a retirement savings goal, compared with only 66.6% and 40.8%, respectively, for singles.

Another significant difference is that boomer couples are far less likely to be relying on Social Security for retirement income, with 37.1% expecting to lean on it as a major income source, compared with 52.7% for single baby boomers.

Boomer couples will instead rely on 401(k) retirement plans to be a significant income source in retirement. Almost half (47.1%) are relying on an employer-provided plan, compared to only 27.8% of singles, according to IRI.

Even though married boomers are better prepared than singles, they are still in dire need of help, as less than 40% are confident in attaining financial security in retirement, the IRI says.

"Considering that just over half of all boomer couples have not met with a financial adviser, significant opportunities remain to meet the needs of this key demographic," says IRI President and CEO Cathy Weatherford.

Of course, that doesn't dismiss the needs of struggling singles who are even less confident about their retirement future than their married friends. Only 28% of singles are confident in having enough savings to live comfortably in retirement, according to IRI.


Boring is better

In addition, data from Fidelity Investments released in February show that 401(k) participants that stayed in and maintained contributions to the same company plan for the past decade saw their account balances quadruple - in spite of the stock market volatility brought on by the recent recession - to an average of nearly $200,000.

Examining 1.1 million 401(k) participants who stayed in the same company plan continuously during the 10-year period that ended Dec. 31, 2012, Fidelity finds that the average account balance skyrocketed by an envy-worthy 324% - from $47,100 to $199,800 - among the group that stayed in the same plan for 10 years. According to Reuters, the Standard & Poor's 500 index only rose 62% over the same time span.

And that's just among participants who are boring. When you carve out "boring boomers" from the statistics, 401(k) participants ages 55 to 59 in the 10-year continuous group had an average balance of $251,700 at the end of 2012, Fidelity reports.


Safe withdrawal is critical

Regardless of age, creating an adequate amount of income for individuals to live comfortably in retirement will require not only a combination of several income producing strategies, but also knowing what constitutes realistic and "safe" withdrawal rates from retirement plans, according to an issue brief by the Institutional Retirement Income Council.

By "safe," the issue brief means a withdrawal rate from retirement plan funds that has a high degree of probability of lasting, or payments from an insured product that are guaranteed to last for the participant's lifetime.

Strategies include:

* Withdrawing funds at a 4% rate in the first year of retirement, followed by inflation-adjusted withdrawal rates in later years.

* Using all or part of the lump sum retirement savings to purchase an annuity for the retiree's life, the joint lives of the retiree and spouse, or with a feature that guarantees payments for life with a specific minimum period.

* Purchasing a guaranteed minimum withdrawal benefit that permits a retiree to maintain some control of the retirement funds but at the same time provides a guaranteed benefit.

"Many retirees believe they can withdraw 10% or more of their retirement savings each year and still have enough money to last their lifetime," says Fred Reish, an IRIC member and a partner at Drinker Biddle & Reath LLP, who co-authored the issue brief. "However, given the statistical chance that at least one spouse in a married couple age 65 will live another 30 years, 'safe' withdrawal rates are much less than most retirement plan participants think. In fact, anything greater than 6% results in a significant risk of exhausting retirement funds while the individual is still alive. This will be shocking to many participants."

Margarida Correia is Associate Editor of Bank Investment Consultant, a SourceMedia publication.

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