June 4, 2012

The percentage of workers who are “not at all confident” that they will have a comfortable retirement rose to 27 percent in the 2011 Retirement Confidence Survey, an annual survey conducted by the Employee Benefit Research Institute.

savings in a jar

This percentage is 5 points higher than the survey results in 2010. And, in the 21 years of the survey’s existence,

“Very confident” about retiring comfortably has dropped to the lowest percentage – 13 percent – the survey has ever measured for this response. 
workers are now more pessimistic about their retirement situation than they have ever been.

Another troubling finding is that 34 percent of workers and 33 percent of retirees have used funds from their IRA, 401(k), savings or investment accounts – or borrowed from those accounts – to pay basic expenses.

Unfortunately, many people are not planning or saving for retirement, and many others aren’t saving enough. Although 59 percent of workers are saving, more than half of them have less than $25,000 in their savings and investments. This amount does not include their home or any defined benefit plan.

Approximately one-third of the workers surveyed estimate that they will need a retirement nest egg of less than $250,000 to be comfortable, but 42 percent say they arrived at the amount needed for retirement by “guessing.”

To add to the insecurity workers are feeling, 45 percent of them are either “not too” or “not at all” confident that they and their spouse can save the amount they think they will need. A larger percentage (70 percent) admit that their retirement or savings plan is behind schedule.

This article was originally posted on June 4, 2012 and the information may no longer be current. For questions, please contact GRF CPAs & Advisors at marketing@grfcpa.com.