SAN FRANCISCO-While many people continue to experience the after-effects of the recession, a majority of older Americans say they are confident in their retirement preparedness, according to a survey by Charles Schwab.
The data shows that 54% of those age 65 and older feel confident in their retirement readiness and reveals that this group is twice as likely to feel confident as those age 18 to 34 (26%). Nearly half (44%) of boomer generation respondents express confidence in their retirement readiness. While older generations tend to be more confident when it comes to retirement readiness, Schwab's survey finds room for improvement. Twenty-one percent of people age 65 and older and 26% of boomers still lack confidence about their retirement. Across all age groups surveyed the number of people with concerns about retirement increases to 39%.
"Planning for retirement can seem daunting no matter how young or old a person is, but it all starts with a practical plan that can help address and alleviate concerns and boost confidence," said Schwab Senior Vice President Carrie Schwab-Pomerantz in a statement. "We know from our survey findings that across all age groups only 39% of people have actually crunched the numbers on retirement savings. So while it is reassuring to see confidence levels relatively high, we know that there is some ground to make up in terms of people sitting down with a plan."
According to the results, working boomers who have planned for retirement were most likely to consult with a financial professional. Fifty-three percent have estimated how much they will need in retirement and nearly half (49%) of working boomers who have planned have done so with the help of a professional.
In addition, Schwab's survey found that along with confidence and the desire to seek professional help, dedication to saving for retirement also grows with age and peaks just before entering retirement. Although retirement takes priority for all age groups, boomers are nearly three times more likely to save for retirement than a vacation (74% versus 24%) while younger people age 18-34 are the most likely to prioritize saving for a vacation, with 44% electing this option.
Not surprisingly, uncertainties about retirement expenses still pose concerns despite growing confidence. More than one-third (37%) of boomers surveyed indicate that unexpected expenses such as medical or health costs in retirement are the most concerning aspect of retirement, followed by outliving savings (18%).
This story originally ran in Accounting Today, a SourceMedia publication.
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