The EBRI Issue Brief said that 24% of workers surveyed are very confident about their financial security in retirement and more than four in 10 (44%) are somewhat confident. However, of those who are very confident, 22% are not currently saving for retirement, 39% have less than $50,000 in savings, and 37% have not done a retirement needs calculation.
More than half (52%) of workers saving for retirement report total savings and investments (not including the value of their primary residence or any defined benefit plans) of less than $50,000. Additionally, 75% of workers who have not saved for retirement say their assets total less than $10,000, according to EBRI results.
Workers are also unrealistically counting on employer-provided benefits in retirement. Only 40% of workers indicate they or their spouse currently have a defined benefit plan, yet 61% say they are expecting to receive income from such a plan in retirement. A significant number of workers (37%) said they expect to receive retiree health insurance through an employer, despite the fact that the number of employers offering this benefit is declining.
Survey respondents do not seem to understand the income replacement ratio that will be needed to sustain the standard of living they want in retirement. While a majority (59%) of workers say they prefer a standard of living in retirement that is the same or better than in their working years, 50% think they can maintain a comfortable retirement on 70% or less of their pre-retirement income.
The Retirement Confidence Survey found that key indicators in retirement planning have remained unchanged over recent years. The proportion of workers saving for retirement continues at 70%, while those who report having attempted to calculate their savings needs for retirement remains at 42%. To boost savings and participation in employer-sponsored retirement plans, workers favor automatic enrollment (69%), automatically increasing the percentage of salary contributed when an increase in pay is received (65%), and automatically investing contributions for the employee (59%).
Other findings of the survey did not match current retirement trends. The average retiree today retired at age 62, but the average worker expects to retire at age 65. Meanwhile, workers are more than twice as likely to expect to work for pay in retirement (67%) as retirees are to have actually worked (27%).
The EBRI Issue Brief is here .