Middle Class Agrees They Are Responsible for Funding Retirement

Forty percent of middle class Americans without a written retirement plan say they have not planned for retirement because they are too focused on “current financial obligations.” This is particularly true for people in their 50s, of which 54% say they are too focused on today to plan for the future.  

Half of middle class Americans (51%) say they need to “significantly” cut back on spending money in order to save for retirement, and this jumps to 61% of those who are in their 50s–prime retirement saving years.   

Other findings of the survey include: 

• 70% of middle class Americans say they are not confident in the stock market as a place to invest for retirement; 
• Three-quarters (75%) of Americans describe their calculations for retirement to be some sort of a guess, and 22% describe their planning efforts as detailed and based on “calculations”; 
• When provided with a list of activities, middle class Americans say that in the last 12 months, they have spent the most time ‘planning’ a home remodel, followed by planning a vacation. Planning for retirement fell to third place in the list; 
• A little more than one-third (36%) of Americans has a written plan for retirement, up from 30% in 2011. Forty-six percent of people between 50 and 59 attest to a written plan; 
• Middle class Americans believe the median cost of their out-of-pocket health care costs in retirement will be $47,000. The Center for Retirement Research has estimated a typical couple at age 65 can expect to spend $260,000 or more over their remaining lifetime; 
• If given $5,000 to invest for retirement, 40% say they would invest it in a CD or savings account, 24% would invest in stocks and 22% say they would invest the money in gold or precious metals. Thirty-seven percent of middle class Americans in their 30s would invest the money in the market versus 18% of Americans between the ages of 25 and 29.  

Rebecca Moore
editors@plansponsor.com