Administrators, staff and teachers or faculty at both the K-12 level and the post-secondary level—both African Americans (87%) and white Americans (88%)—are more likely than U.S. workers overall (59%) to currently save for retirement. Seven of 10employees are “very” or “somewhat” confident they will have enough money to retire comfortably, while less than half of all U.S. workers express this level of confidence.
Looking at education sector employees alone, those who have saved at any time are confident that they are saving and investing in their best interest. More than three of every four (who have ever saved) are c“very” or “somewhat” confident that they are investing their savings appropriately. Three of every four employees are “very” or “somewhat” confident that they are saving enough to retire when planned. In addition, 61% of black employees and 67% of white employees who have ever saved are “very” or “somewhat” confident that they will not outlive their savings.Further examination of the high degree of retirement confidence among employees in the education sector, however, yields conflicting insights. For example, the percentage of workers in the education sector who are confident they will have enough money to live comfortably during retirement exceeds the percentage who have figured out how much they need to save to have a financially comfortable retirement (about half). In addition, among African Americans more so than Caucasian Americans, having high levels of debt and using their savings to cover basic expenses may limit their ability to retire comfortably.
Nearly one of every four black Americans (23%)—but only one of nine (11%) white Americans—describes their level of debt as a major problem. Moreover, more than one of every four black Americans (27%) and nearly one of every five white Americans (18%) used their savings to cover basic expenses in the past 12 months.
The receipt of advice from a financial professional may be associated with the high degree of retirement confidence among members of the education work force. Around three of every five Americans received retirement planning advice from a professional adviser in any of the past three years, with white Americans (45%) more likely than black Americans (38%) to have received such advice in the past year. Sizable majorities of each racial group received advice on how to invest—77% of black and 83% of white Americans; how much to save—71% of black and 68% of white education sector workers; when they can afford to retire—65% of black and 60% of white respondents; and how to draw down their savings when in retirement—58% of black and 50% of white education workers.
Black and white employees in the education sector also are confident they understand the options available for drawing income from their savings (78% of each group), and that they will choose the best way to draw down their savings when they retire (85% of each group). African Americans (50%) are more likely than white Americans (36%) to say that they plan to convert all or some of their retirement savings to a payout annuity, however.
White American employees in the education sector (49%) are more likely than their black counterparts (31%) to cite health care expenses as their biggest financial concern during retirement, while African Americans (44%) are more likely than white respondents (33%) to have received advice from a financial professional about paying for health care during retirement. Receiving this advice, combined with the greater expectation of receiving retiree health benefits among African Americans (65%) than among white Americans (54%) may account for the greater degree of confidence among African Americans (24%) than among white Americans (18%) that they will have enough money to pay their medical expenses during retirement.The research report is here.