Boomers Looking To Social Security

December 18, 2002 ( - Thirty-six percent of baby boomers are not saving for retirement, with 70% saying they intend to rely on Social Security, according to a MassMutual study.

The study of 1,177 Americans, between the ages of 38 and 56, found 81% saying basic necessities, such as gasoline and groceries, have affected their ability to save.   Of those necessities, 68% said they are paying for a house and 53% are burdened with credit card debt.

However, 67% of those polled report they are saving, with 55% participating in employer-sponsored savings plans, 28% contributing to IRAs and purchasing individual stocks, 27% investing in mutual funds and 9% participating in an annuity.

In addition to the 70% of baby boomers counting on social security to fund their retirement, 55% are relying on either a 401(k) or 403(b) plan and 36% are looking to their savings accounts for retirement income.

Among those saving, 23% indicate working closely with a financial professional, with 71% saying their financial professional helps them to understand different savings/investment products and 63% feel they help simplify the investment process.  

Additionally, the survey found those working with a financial professional tend to save 14% of their annual income, versus the 5% of annual income saved by those not using professional resources.

Working Longer

This reluctance to save may be contributing to more baby boomers expecting to work later in life, with 56% expecting to work beyond the age of 65 and 33% expect to fund retirement through part-time employment.

A previous study by AARP  showed similar results among Americans between the ages of 50 and 70.   The AARP study reported only 31% expecting to retire before the age of 65, in contrast to 72% who at one time expected to retire before age 65.  

Additionally,   33% said they have returned to the workforce due to the recent stock market losses.