The recession has cast a pall over the retirement expectations of the vast majority of Americans, leaving a record-low 13 percent this year able to say they are very confident of having enough money to live comfortably in retirement, according to the 19th Annual Retirement Confidence Survey (RCS) released today by EBRI. Among workers, those feeling very confident about retirement has tumbled by one-half in the last two years.

RECORD LOW CONFIDENCE LEVELS: Workers who say they are very confident about having enough money for a comfortable retirement this year hit the lowest level in 2009 (13 percent) since the Retirement Confidence Survey started asking the question in 1993, continuing a two-year decline. Retirees also posted a new low in confidence about having a financially secure retirement, with only 20 percent now saying they are very confident (down from 41 percent in 2007).

THE ECONOMY, INFLATION, COST OF LIVING ARE THE BIG CONCERNS: Not surprisingly, workers overall who have lost confidence over the past year about affording a comfortable retirement most often cite the recent economic uncertainty, inflation, and the cost of living as primary factors. In addition, certain negative experiences, such as job loss or a pay cut, loss of retirement savings, or an increase in debt, almost always contribute to loss of confidence among those who experience them.

RETIREMENT EXPECTATIONS DELAYED: Workers apparently expect to work longer because of the economic downturn: 28 percent of workers in the 2009 RCS say the age at which they expect to retire has changed in the past year. Of those, the vast majority (89 percent) say that they have postponed retirement with the intention of increasing their financial security. Nevertheless, the median (mid-point) worker expects to retire at age 65, with 21 percent planning to push on into their 70s. The median retiree actually retired at age 62, and 47 percent of retirees say they retired sooner than planned.

WORKING IN RETIREMENT: More workers are also planning to supplement their income in retirement by working for pay. The percentage of workers planning to work after they retire has increased to 72 percent in 2009 (up from 66 percent in 2007). This compares with 34 percent of retirees who report they actually worked for pay at some time during their retirement.

GREATER WORRY ABOUT BASIC AND HEALTH EXPENSES: Workers who say they very confident in having enough money to take care of basic expenses in retirement dropped to 25 percent in 2009 (down from 40 percent in 2007), while only 13 percent feel very confident about having enough to pay for medical expenses (down from 20 percent in 2007. Among retirees, only a quarter (25 percent, down from 41 percent in 2007) feel very confident about covering their health expenses.

HOW WORKERS ARE RESPONDING: Among workers who have lost confidence in their ability to secure a comfortable retirement, most (81 percent) say they have reduced their expenses, while others are changing the way they invest their money (43 percent), working more hours or a second job (38 percent), saving more money (25 percent), and seeking advice from a financial professional (25 percent). Among all workers, 75 percent say they and/or their spouse have saved money for retirement, one of the highest levels ever measured by the RCS.

IGNORANCE STILL A MAJOR FACTOR: Many workers still do not have a good idea of how much they need to save for retirement. Only 44 percent of workers report they and/or their spouse have tried to calculate how much money they will need to have saved by the time they retire—and an equal proportion (44 percent) simply guess at how much they will need for a comfortable retirement.

Figure 15 Figure 19 Figure 3 Figure 8 Figure 7 Whil 200 Ruth H Figure 5, Wor some other y confidence. Retirees time, the perc Preparing The large maj financi Attitudes Regarding Financial Planning RCS Methodol younger 8. e a • Anothe a ell o l a The per who lman work d f th vis O i ek worked for ers), e demogra o entage o —or Not—for Retirement r 33 s ars of th ter rity of hers pl research r (18 centa Attitu p workers e ogy perc ge of all rcent not workers partici anni e R de pa dir p at ent s About Fina hi C ng to retir sS currently y in r c grou e a all ).ctor for worker . y they a In con Others r e part ps e tirem fident e Math p parti s saying th r icular atin nc lx e ae a e ter inclu a li int most often s m a a a g in c l Pla d ew b ined show ipatin ,ttl or out lo 32 percent e th Green nnin le hear ey e de worker g i ss ng-ter plan g and/or n confi ho w ............................................................................ a a ald & work (72 w o decli m care a mu dy th f th ent. s work pe Associates. Craig Copelan plac n not ch eir ey di e rc More is ne in r ex ent) st s ers in ee ret px pens d ouse pect etir s eded th o i th r e ate that es has rise e in beca an hal ment co have sa ment s e 2003 RC g bene (9us percent f o e they a ved mon nfi fits fro th fvin r n fr d ey enj e S i g e tir have not s ) n om 24 , use a n pla d ees ce i m d is senior r icated th e oa defi als n n y fo yed worki th (compar percent n o chan re t onl retirem feel ne w eir d benef ie n o t ged the percentage of search associat e -n e in hey hav year expect calc g (7 d ewith 20 nt 9 perc ulator iinterval .................... t 07 no ed retir pension thos e los to 3 w stan en (7 e t 8 per t, per e not e at ment pla ds at dow --n10 n The 2009 Retirement Confidence Survey: Economy Drives Confidence Figure 1-A Av Percen ailabilit Contage fidenc y Work of Emplo of Wor eer Co Confidence in Various That Social ker y nfidence in Financial Asp er- s Repor Prov Securit ided He ting a y Will alth Insuran Financial Oc Ty Continue to pes of Ins ecce Cov ts of curren titutions Retir Pro ece Co rage ve ide Benefits ment in Retireme ntributed to nt the Employee Benefit Research Institute (EBRI). Jack VanDerhei is the research director at EBRI. This Issue Brief was Several key attitudinal measures about financial planning and preparing for retirement have also changed over time. from 93 age cent i partici betw cent), (compar their salary confidence had cha een n or p 2 atin 75 e 2 perc 0fill d wit 0007 a g), co perc 9 o n b ent in (Figure u ged in out havin and workers h ntribut and 2 h t a ent, a those worksheet or form 2008) or the 0 e 4). n 0 d to th increase over who 9 g pas , so en expect ough t me gro wanted to 12 e plan aving attempt months, money t these benefits), no u in t ps ar (5 the perc stay active a he percent e and o past year. espec live ed enta 75 a comfort )retir percen i(Fi ally ges measured g n eur d ment Ho like nsaver in e 22). ably thro t of t wever, 16 lvolved y in t savings s hose said their (com he i (7 ugho past n 2 6 perc par nee per 004 ut thei e year to d ent say they d with cs calcu –2 ent, 00 retir r ret 7 down those who have have l land o ation ie re me fro ment years inc o nt ha ne o (compar st confidence m reased t 91 fd t p h bee e hi e e (1 rcent d wit sav h ne per ghest 8 percent postponed (Fi e about ) d for h, but those c level entage r the havin e much less tirem swho ever g g h e ure nt), ave 10 , ). These findings are part of the 19th annual Retirement Confidence Survey (RCS), a survey that gauges the views and Saving for Retirement Figure to Record Lows; Many Lo 6, Change in Confidence About Havi oking to Work Longer ng Enough Money to Live Comfortably Throughout Their Retirement Years Ver Ver RCS Trends: Worker Co Woy y rke nfidence in rSomes Some what what Having Enough Money Retire Not too Not T es oo Not at All Not at all Their Loss o of at Le f Con ast Equal Value to Bene fidence, Among Tho fits se Less Receiv Con ed b fident y Retiree Abou s Toda t Retireme y nt written with assistance from the Institute’s research and editorial staffs. Any views expressed in this report are those of When asked how well the statement “You think anyone can have a comfortable retirement, if they just plan and save” 36 perc not). Workers a and perce enough mon contribut workers a ntage ent measured ed g w an e 45 an ae li h y for a g ttle less d 1 o worke e 35 or ol 1 by d ol perc fi t c nanci he RC der do ent s n der o ar fide lally secur e d S. (com e somewhat ly for en creas Th t) (F pos pared e e ig proporti d e ui the ret tive re 6) wi more likely th i rement reas th youn perce . on of r ons n. tage. ger has Amo etirees wo r an yo n eg rkers). maine who workers a un report havi ger d s workers to say t tea gd es 44 y over th ng –5 saved 4, th e pas e h for ret eir perce t year expected in rement has tage (25 per very retirement a cent i confi rem n 2 d ained ent 00g 8 e has , 23 per- attitudes of working-age and retired Americans regarding retirement, their preparations for retirement, their confidence In addition to changing their expectations about retirement, many workers who have lost confidence in their ability to Confident Confident (Expected) Confi Confi dent dent (Rep Confi orted) Confi dent dent Confi Confident dent Compared Wit Ver h Last Year ........................................................................................................ y Somewhat Not Too Not at All .................11 the authors and should not be ascribed to the officers, trustees, or other sponsors of EBRI, EBRI-ERF, or their staffs. By Ruth Helman, Mathew Greenwald & Associates; Craig Cope Figure 4 land and Jack VanDerhei, EBRI to Live Comfortably Throughout Their Retirement Years describes them, 63 percent say it describes them very well or well (down from 71 percent in 2002). Likewise, workers changed. cent i decrease n 2009). relatively d from The large m 21 constant at percent i an 2 jority also identify at 62008 per to cent. 10 percent in least 200 o9 n, w e financ hile the ial r percenta eason for ge havin not at g wo all rked, confi suc dent increase h as wantin d fro g money m Banks with regar Havin d tog various aspec enough monety to take s of reti200 Confi9 36% rement, an dent d related Confi Among Al issues. dent Th l We orkers survey was co Confi41% dent nducte Among W d in Ja on Confi rker uary 2 s W dent 009 ho Lost through secure a comfortable retirement are responding by taking some steps to improve their situation. The large majority of Neither EBRI nor EBRI-ERF lobbies or takes positions on specific policy proposals. EBRI invites comment on this April 2009 • 60% No . 328 Retiree Confidence in Financial Asp Figure 22 ects of Retirement Figure 12 Figure 6 Half of participants (49 percent) report that they last reviewed how their money is invested in the plan and made any Retirement Savings are less l Figure Wo7, rkers care of basic e ikely Percentage of to reportx the statements p Wor ensk es ers Repo 2008 rting a “You enjoy 21% 56% 14% Financial financ O34 ccurrenc ial planni e Con ng” (48 perc tributed to ent, do 41 Their Loss of wn from 57 percent Confidence,9% in 20 Amo 02 n) g and 18 to make e percent toWo nrdske r27 meet s perc (6ent. 0 perc Sient) milarly, amon or wantin g wo g mon rkers wit ey to bu W h house ho Lost Conf y extras hold (52 in ide percent come of nce ). $ Yet 75, Confi 000 few r or mor denc etirees who have not e an e, t d Experi he perce enc ned tagEvent al e ready very Very Confident Somewhat Confident 20-minute telephone interviews with 1,257 individuals (1,001 workers and 256 retirees) age 25 and older in the United these workers (81 percent) say they have reduced their expenses. Others are changing the way they invest their research. Very Somewhat Not Too Not at All Method of Determining Savings Needed for Retirement, Chan Comparis ge in Confiden on of Planned a ce About Hav nd Ac ing tual Re Enough Mon tirement ey Age to Liv e Retirees 2009 2007 41 27 51 12 25% 49% Figure 10 43 14% 11% 9 necessary adj • Many workers200 ustments in9 6% still do the last not ha quarte ve a rgood ide of 2008. a of Tw A Great how en26% ty-o muc ne percent say they h they need to save for28% last revi retir A Great ew eed ment. thei Only r asse39% 44 t alperc lo cati ent o on f Many Americans have little money put away in savings and investments. Among RCS workers providing this type of Those Less Confident About Retirement.....................................................................................................12 “Over the long run, you believe stocks in general will be a very good investment” (48 percent, down from 60 percent in worked for confident decr pay in r eased etirem from e33 nt perc antici ent pate ret in 20u 08 to rning 2to 5 perce paid employm nt in 2009, ent. wh Just 5 ile the percen percent t say it is age not too ver or y likely not at they all confident will work Confident Not Too Confide Confi nt dent Confident Not at All Confident Confident States. Random digit dialing was used to by Doing a Retirem obtain a representative cros ent Needs Calc s section of ulation the U.S. population. To further money (43 percent) and working more hours or a second job (38 percent). Steps taken by fewer of these workers Comfortably Wo Throughout Their Retirrke ement Years rs Compared Retire With La es st Year Insuranc Introduction e com Percen200pan8 ies tage of Wor200 ker6 s Reporting a 34 45 12 Chan 37 ge in Retirement Ag 40 e in the Past 12 Month9 s 2008 5 Deal 21 34 37 Some Deal Some earlier in workers re 2008, whi por le tth they a e remainder nd/or t a hd eir s mitp they ouse last revi have trie ewe d to d th cal eir culate plan investme how much mon nts in e 20 y th 07ey wi (12 percent ll need to ) or have eve saved n information, Havin 50% 53 percent g enough report that th money to e total value of their househol d’s savings and investments, excluding the value of 2002) describe them very well or well. On the other hand, the percentage of workers who feel that preparing for increased fro for pay some t mi 17 percent me in the fut to 28 percent. ure, and 9 per At t cent say it he same is time, work somewhat likel ers ages y. 25–34 and those with household income less (multiple resp (Planonses a ned) ccepted) (Actual) increase representation, a cell phon Workers e supplement was added to the sample. StartingRetirees with the 2001 wave of the RCS, incluWo de: rkers 2007 2005 40 14 40 42 11 53 42 20 13 7 Copyright Inf th200ormation:7 This report 7 is % Rep copyright orting C ed by the Em hange 24 34 34 ployee Benef % Postpon it Research Institut ing Retireme e (EBRI nt ). It may be T Figure 8, he recent eco Confidenc nomic u e That S ncertaio nt cial y, in g Security Will eneral Continue 64% to Provide Bene28% fits of at Least Equal 64% Value to Benefits R 28% eceived The 19 wave take care of ba of the Retir sic expe ement Con nses fidence Survey (RCS) finds that Americans’ confidence in their ability to afford a earlier (1 by the time they retir 3 percent). The majo e so that th rity of thos ey can liv e indicatie ng th comforta ey revie bly in wed reti threment. eir allocation An equa s in Octo l prober– portion—4 Decem 4 percent ber 2008 also of their primary home and any defined benefit plans, is less than $25,000. In fact, 20 percent say they have less than Before 55 3% 18% retirement tak Retirees 200 es too much time and 6 35 Much less confide 200 nt 4 effort has 11 increased (from 14 35 21% 56 perc47 ent very well 41 20 or 9 18% well in 2002 to 12 9 21 percent in than $35,00200 0 show littl6 e, if any, chan6 ge in retirement confid27 33 34 ence between 2008 and 2009. Inflation and the cost of living In Retirement Age 49 Did Retir 39 (of those rep ement Needs C orting ch 49 alcu anlge) ation 39 all data are weighted by age, sex, and education to reflect the actual proportions in the adult population. Data for used without by Ret permission irees Today bu.............................................................................................................. t citation of the source is required. ......................13 2009 34% 45% 12% 9% comfortable retirement 55–59 has dropped to its lowest level sinc 6 e the RCS first asked the question 17 in 1993, reflecting worries Income Needs in Retirement T The 2009 Retirement Confidence Survey: Economy Drives Confidence say they he federal workers—simply gu previgo200vernme ously reviewed th 5 Soment what less Sour ess at ho ce: Employ eir confide plan w muc all n ee Bene t oh cations in th fiey t Resea will35 42 11 11 Ja nee rch Ins nuary–S d33 to titu ac te and Mathew Greenwa eptem cumulate. ber 2008 (68 ld & Associate percent). 36 B su , t some state their T $1 he decrease i ,000 in savi200 n ng the valu5 s. Ap2009 28% pr e of oximate your retirem ly 1 in8 10 w ent orkers each re23 33 35 port total savings and investments of 89% $25,000–$49,999 2009) (Figure 5). All Workers Yes No • Saving more money (25 percent). waves of the RCS conducted before 2001 have been weighted to allow for consistent comparisons; consequently, some 2008 34 45 6 14 40% 1 60–64 17 Inc., 2004–2009 Retirement Confidence Surveys. 37 Workers 2004 36 About as confident 11 48 21 18 28 47 8 32 8 2004 7 28 31 32 Perha about t savings ps reacti he econ ng to omy and th 200 an 8 assessment of e cost of he how alth care. much mon In r 18 ee sponse, many y t26 23 hey will have workers to spen are a d ratd he jur than sting t 79 49 an heir assessment of ho expectations 44 abow ut Recommended C previous Loss of confi revie dence ov wGuess 44% occurr itation er th ed in e : Ruth H 200 past year 7 (1 e7 perc lman, in thent) Craig e ability to or earlier Cope sec lan (11 du , an re a perce d Jack financia nt). Vall nDerh y comfortable 14% ei, “The 200 retireme 9 Re70% tirem nt als eo nt Conf appears to idence h ave (11 Figure perce 9, Co nt), nf $50, idenc 00 e 0–$ That M 99,999 edicar (12 e p Will erce Cn ot), ntinue $100,0 to P 00 rovide –$249, Ben 999 e (12 fits of at L percent east Equal ), and $2Value 50,000 to or Be more (12 nefits Rec pe eiv rced ent). by 2007 48 35 8 8 to Record Lows; Many Looking to Work Longer 41% data in the 2009 65 RCS may differ slightly with data published in 23 previous waves of the RCS. 12 Data presented in tables in Retirees 1999 A little more confident 11 45 22 22 31 50 13 11 7 5 1999 7 21 38 33 The increase i n your da2005 21 y-to-day expenses 24 23 84 44 44 • Perhap Do s not s your o urprisin wn estimate gly, those who were more knowle 26 dgeable about 2 46 and prepared for 10 retirement posted a Figure 5 retirement, and some are taking steps to improve their financial preparation. much it • wi Seekin ll co200 st to maintai g ad6 44 vice from n a an acce financpta ial b profession le lifestyle, al (25 work percent ers have40 ). adjusted their7 expected spendin7 g in retirement Survey: Econo occurred main Retirees ly among thos my Drives Co Today................................................................................................................. ne w fideh no hav ce to R e ta ecken steps ord Lows; Ma to pr ny Looking to epare for retirement. Work Lon Amo ger,” n EBRI Issue g workers who have do Brief, ........................ no. 328, ne A a pril 13 Retirees provide similar estimates of total household savings (Figure 18). 66–69 10 5 Investment companies 1994 40 Much more confident 5 41 9 6 9 this report The decrease i ma199 y not total to n the amou4 nt you 100 due to were abl4 ro e to unding and/or missing c18 38 39 ategories. By Ruth Helman, Mathe 2004 w Greenwald & Associates; Craig Cope 16 land and Jack VanDerhei, EBRI 66 Ask a financial advisor 18 33 5 Worker Attitudes About Financial Planning Very few parti sharper c200 ipants loss of confidence t5 41 (9 percent) state han those who wer they currently he a not. ve a A loan 42 mong th from their e perc work entag11 -place e of wor retirke ers who me5 nt savings have don plan e. a These downward over the past t 30% wo years. One-quarter of workers now say their spending in the first five years of retirement 200 retireme 9. nt savings n 70 or ol eed der s calculation, the percentage reporting t 21 hey are very confident de 5 creased 10 percentage points Workers 1992 Source: Employee Benefit Resear3 ch Inst25 51 16 itute and Mathew Greenwa 34 ld & Associ34 ates, Inc., 2009 Retirement 26 6 EBRI Employe1992 e Benefit Research Institute I3 ssue Brief (ISSN 0887 -27 44 24 137X) is published monthly by the Employee Benefit Research Institute, save 24 2003 32 20 75 47 39 Read or hear how much Figure 10, Percentage of 2004 44 Workers Reporting a 199 Change in Retirement A8 32 200 ge in the Past 0 14 20012 Months2 200 ................................8 9 14 However, faulty assumptions and a lack of planning still hinder the ability of many Americans to realistically assess the respondents a • Moving to retireme re more Never retir nt sav a le likely ss expe ings n e/ne to have o ensive h ev der s cal woculation, t o rke b me or ar tain d ed tea h he e (11 percenta loan perc in the secon 10 ent). ge reporting t d halfh of ey a 2008 re very (15 co perce nfi 6 dn ent decreased t in October–Decem from 29 per- ber Retire 1100 Doin 13t es h S g a g t. NW Confidence Surv ood j , Suite ob of prep 878, Washi ey. ari ngt non, g for DC, 20002 5-4051, at $3 Figure 18 00 per year or i 31 s included as part of 24 a membership subscri37 ption. Periodi- Retirees 22% T will he increase i be much Sourc le n o : Empl hea wer t lth e h oyee B an xpin t ee nnef s hes e it Res five y eae rcars h Inst befor itute and M e they retire athew Greenwa 22 (25 pelrce d & As nt, up s24 ociat from es, In 2 c.0 , 2003–200 percent 42 9 in Ret 20 irement 07). A nother 46 32 per- (from Sources of Retirement 29 percent in nee 20de 08 d to 19 Income percent in 2009), but co9 nfidence remained lev 9 el among those w 9 ho have not done a In theory, the weighted sample of 1,257 yields a statistical precision of plus or minus 3 percentage points (with 95 per- 1999 45 36 12 7 You think anyone can have a comfortable Report availability: cals postage raDon’t kn te paid i T n h W oiw s a re sh in pgto ort n,, D alC o,n and g wi addi th se tional m ven r aile ing la o te ffi6 d ce 2 s00 . PO 9 R STC MAS S Fact S TER: Sh end eets, addris availa ess ch2 ange ble on t s to: EBRI he Int Issue e Br rnet ief, at 1100 preparations t Source: Empl retirement oyee B hey n enef eed to ta it Researke to en ch InstitutEXECU sure a e and M fina athew Gr ncially Teenwa IVE SUMMARY seclu d & As re restirement ociates, In . c., 2009 Retirement Confidence Survey. The decrease i Confidence Surv 200 n the valu 9 eys. e of your nonretirem 13% ent 43% 24% 17% 2008 ancent i d 19 Reported T percent n 2008 t in J o 19 uly– o p tal Savings and Investments, Among Those Providing a Response eS rcent eptem in 2 ber 009. 2008) tha (Among t n inhose not the first hal doing f (13 a calc perculat ention, the ). Yet half perce report t ntageh very eir loa co nnfident dates to Use an online calculator 7 16 <.5 cent i Figure ndicat 11, Pla e tnned Ret heir spenirem dinge will nt A be ge, Amo a little n l g oWorkers wer, and an ............................................................................... equal percentage say their spending will be about th ................ e same 14 calculation Workers co (8 ntinue to percen e t in xpect 200 to cobble to 8, 9 percentge inther th 2009). eir r Likew etireiment se, among th income from a ose with variet $100y of sourc ,000 or mor es. e i Although n savings 8and 1 percent 13th St. N retirement, if th W,199 Suit4 44 e 878, W ey ashi just plan and save ngton, DC, 20005-4051. Copyright 2009 by E37 mployee Benefit Re12 search Institute. All ri7 ghts reserved. No. 328. cent certainty) of what the results would be if all Americans age 25 and older were surveyed with complete accuracy. 20% Source: Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc., 2009 Retirement 2009 20% 49% 16% 14% www.ebri.org 200 Th 8 e RCS Fact Sheets cover 14 such topics as chan 36 ging expectations a 31 bout retirement, age, a 16 nd gender. savings 19 21 39 43 Among workerFill out a s, those age works 45 an heet or form d older (compared with 5 younger workers) a11 nd women (compar 0 ed with men) are 2007 (14 perc remaine ent) d stea or even e (not dy at inclu 9 arlier (3 perc den in7 perc g t in valu 20ent). 09, e of p com rimary pared with resid 8 e pnce or ercent in de 20 fined ben 08.) Likee wise, fit plans) among those with 1992 28 37 25 5 Describes respondent very well 38% 35% 32% 24% (32 report t perce hey nt) (Figure expect to14 rec ). eive at least some income from Social Security, personal savings will also play a large role. investments (exclu Confidence Surv ding their prim ey. ary residence), the percentage very confident decreased from 35 percent in 2008 to 2008 23 48 16 12 There are other possible sources of error in all surveys, however, that may be more serious than theoretical calculations You (or your s 200 pous 7 e) losing your job or movi 17 ng to 43 18 18 The RCS proviAdvice of frien des some evid dence o s/familf y t hese actions. The 2 percentage of all work 1 ers saying they a 3 nd/or their spouse have Fin Although Figure dings in 12, few Co thimparison o rate media s year’s RCf reports as S i Planned nclude: and Act very im ual Retirement Age portant when it com ..................................................................... es to bolstering confidence in investment compa ............ nies 15 Almost two-thirds of workers delaying their retirement age (63 percent) say that this change occurred after September RECORD especial ly like LOW CONFI Did a g ly to in ood job dicate DENCE of prepar th LEVELS: ey hav ing $10,0 e lost Workers who 00 confidence – say t $25,0 about their h 0ey are very 0– ret $50,0 irement secur confident 00– about ity $10 over the past havin 0,000– g enough money year. for a Describes respondent well 34 35 39 39 $100,000 or more in savings and investments, the percentage dropped from 35 percent in 2008 to 26 percent 2007 26 45 15 13 26 Roughly perc a loent w 7 e in r pa in 200 1200 yi 06 work ng 9, alt job ers eac hough it sho h say they w19 ed ant little cha icipateng rec e am eiviong those 16 ng r 44 etirem hav ent ing income 6 lowefrom a r lev 22 elsn of savin em69 ployer-s gs (1 ponsored r 2 p 13 ercent26 in etire 2008, ment of sampling erBase it on ror. These w inc hatlude you re will h fusals t ave o be interview 2 ed and other forms of no <.5 nresponse, the 2 effects of question saved money for retirem <$10,00 ent 0 now stan $24,9 ds at 99 75 percent, $49,9 an99 increase ove $99,9 r that m 99 easur$24 ed 9,99 in 209 $25 04–2007. 0,00 Whil0+ e th e (14 percen for retirement t ofDescrib workers, es resp 11 pond ercent ent not too of retirees), well a majority 18 say that the 18 company’s r 17 eputation is very 24 important when it 2008. comfortabl The Among the reasons 2009 e re Reti tirement rement this y Confi given ed ar hit ence for this the Survey lo cw hange ar w est level as underwritt e: in 2009 en by (13 perc more t ent) sinc han two e th do e R zen etirement organiz Confi ations, li denc sted on e Survey pg. 3. Figure 14 10% 200 6 25 50 14 12 in 20 200 09. 5 21 37 26 12 T Whil Figure 13, he increase i e the av Per er ncentage Working for age your lev age at r el of debt etirement Pay is likel in Retirement y to contin............................................................................ ue 14 to increase and many 12 workers may work 50 until their .................. 41 planned 15 Other 3 1 4 savings plan (75 percent), an individual The Em retirement ployee Benefi acco t Research Institut unt (IRA) (63 perce e (EB nR t), I) was founded in 1978. Its and other personal savings a mission is to nd 11 percent in 2009). Worke •r sThe per 200 centa 9 ge of workers very confide 28% nt about having 37% enough money for a 17% comfortable 16% retireme13% nt continued wording and question or Describes resp der, ond and scre ent not at a ening. ll While attemp9 ts are made t 11 o minimize t 10 hese factors, 12 it is impossible to perce The RCS ntage sought to e of workers havi xplore t nh ge re saved for asons be rehind this loss tirement increof co ased nffridence om 19 9 by asking wor 4–2000, it dek cers lined signific whether t ahey ha ntly in 2 d 001 exper an ience d has d comes to givin 200 g th 5 em confidence about Post-Re companies tirement v 26 that s. provide Pre-Re fitiremen nanci 46 al pro t Spending ducts (60 percent, 12 59 perce 16 nt, T started askin he decrease i 200 g the n the valu 4 question i e of your hom n 1993, conti 18 e nuing a two-ye11 ar de 39 cline. Retirees also 19 26 posted a n 25 ew low in11 confidence 44 about Retirement Savings Source: Empl Needs oyee Bcontribute to enefit Researc, to encourag h Institute and M e, an athew Greenwa d to enhance the developmen ld & Associates, Int of sound empl c., 2009 Retirement oy ee benefit retirement age, others could find themselves retiring sooner. The RCS has consistently found that a large proportion of 2008 26 43 11 17 200 • 9 The poor Just wh economy (36 en yo40% 13% 11% 12% 12% 12% u think you perc have a ent, up from handle on 15 percent in 2008). investments (70 percent). Fifty-nine percent indicate they will receive income from an employer-sponsored traditional quantify th a two e errors that may -year decline (13 result percfrom t ent, down hem. from 27 percent in 2007 and 18 percent in 2008), reaching its lowest 2004 Wo 26 rker47 s 14 Retirees 12 hovered arou various fin T Figure he major illn 14, Pos anci 199 e nss or other me tal eve d -Retir 9 70 perc n ement ts over ent s vs dical the ince t . Pre-Retirem past ye event hen. 17 Th ar.e pro Rou ent Sp p gortion ending hly hal o 10 f......................................................................... fof retir 34 work ees ers report that th having save 10 d 33 for r e va etirement lue o 37 f th has eir re remaine ti12 rement ................ d r 36 savin elatively gs 16 respectively Who we are ). Other Confidence Surv factors selected by ey. about half of workers and retirees as very important are investment having a financially secure retirement, programs and so with only 20 und public policy percent now sayin through objective g they are ver resear y confi ch andd educati ent (down on. EBR from I is the only 41 perce nt One i200 ndicator8 your fina of retir 2007 nces, somethi e36 13 12 12 15 12 ment plann ng al ing that ways hap has not sho pe 39 ns wn an improvem 41 ent is the 10 percentage of wor 7 kers doing a Nevert heless, worker confidence in having enough money for a comfortable retirement continues to increase with retirees leave the work force earlier than planned (47 percent in 2009). Many retirees who retired early cite negative pension or cas 199 h ba 9 lance plan. In contrast, retirees mor 23 e often say they 50 receive incom 17 e from Social Security 9 (92 199 0%4 16 35 (Planned) 30 (Actual) 10 The increase i level sin n the amou ce the RCS nt you pa started a y in mortgag sking the e question in 1993. Retiree confidence in having a financially secure private, nonprofit, nonpartisan, Washington, DC-based organization committed exclusively to constant in decreased (5 re 3cent years percent o (at f th os 62 e who percent) had s (Figure aved 1 for r 7). etirement), their day-to-day expenses increased (52 percent), and performa200 • 7 The nce (54 ne 200 ed to perc 6 make u ent, 35 13 10 13 15 14 44 perc p for lo ent sses in the ), the company’s cr stock 42 market (28 percent, edit rati 35 ng (53 percent ea up from 12 3 perc ch), and a ent). long-term relatio 10 nship Declining Retirement Confid that sets you back from your finaence ncial goals in 2007). retireme Table of Figure 15, nt n Ava e Content eds calc ilability of Employer-Provide ulations , wh ich means that ma d Health I ny nsur workers still ance Cove do not h rage in Retirement ave a good i ........................................... dea of how much they need to ...17 household inc reasons for le 199 aving t ome. 4 Worker he work confidence force before als they o increases expecte 22 wi d, inc th savings luding h and investments 42 ealth problems or disa a 20 nd with bility impro (42 perce ved h 15 enalth t), changes status. or rent 199 Much lo 2 wer than before 13 you retired 10 33 25% 8 35 26% 40 15 34 The RCS was co-sponsored by the Employee Benefit Research Institute (EBRI), a private, nonprofit, nonpartisan public percent) and are less l 1993i kely 1994to rely o 1995 public 1996 n any poli 1997 form of pers c y r 1998 esearch 1999 onal saving and 2000 edu 2001 cation on s (F 2002 igure 16) econ 2003om 2004 .i Th c securi e perc 2005ty 2006 enta and em ges 2007 plo of work y2008 ee b enefi 2009 ers an t iss d ues. retireme 200 nt has 5 also dropped to a new low, 35 with only 2038 percent now sa13 ying they are very 13 confident (down from 2006 Describes resp39 14 12 12 11 12 ondent very well 29% 23% 28% 31% the amount they paid for health care increased (46 percent). Substantial percentages also indicate that the amount (48 percent, 45 percent) (Figure 20). 1992 21 46 21 11 Source: Employee B A little lo enefit Res wer earch Institute and Mathew Greenwald & Ass32 ociates, Inc., 1992–2009 Ret23 irement Confidence Surveys. save for r Provide sign etirement. O ificant financ nly ial as 44 percent sistance to a fa of workers report mily they and/or their spouse have tried to calculate how much Others more o Introductio Overall Reti n................................................................................................................... frement Con ten confident are men fidence (compared with women), married workers (compared ....................................... with those not married), 4 at their • compa Wanting to m ny, such as ake sure they downsizin EBRI’s member have enough g or closure ( ship includes a mo 34 p ne ey rc(ent), 24 perce an cross-section of d havi nt, up ng to from 1 care for pension funds; businesses; trade associations; 7 perce a spouse o nt). r another family policy r THE ECe ONOMY, INF search orgaLA nizatio TION n; , COST OF LIVING ARE and Mathew Greenwal TH d & E Associat BIG CONCERN es, Inc., a S: Not Washin surprisi gton, DC ngly, workers overall who ha -based market research firm. ve lost retirees 2005 expect 200 Describ ing 4 income es resp from each ond52 ent w sourc ell e remai 38 ns un13 11 12 11 Figure 17 ch28 anged from t 31 30 hose observed in 13 26 previous waves of t 16 26 he RCS. 41 percent in 2007 and 29 percent in 2008). Figure 16, Sources of Income in Retirement ...........................................................................................................17 Having enough money to take they were able to save (41 About the sampercent), e the value of their nonretirem 32 ent savings (38 percent 35 ), and the value of their home member or friend 9 9 37 37 labor unions; health care providers and insurers; government organizations; and service firms. Face money they200 d with 4 concerns a will n 199e 9 ed to bout t havh ee eco saved by54 nomy a the time nd t34 he cost o they re14 11 13 ftire so that living, as w 40 th ell ey can as worries live 16 co abo mfortably ut the declin in r9 etirement. ing valu9 e o Th f savi is is ngs those who Declining Ret member (18 percent expect to r irDescrib ement Co ). es resp e Others say work-r ceive nfidence ond retirement benefits ent not too ................................................................................................ American elated reasons ws Hav ell from ing Sa both a (22 pe 28 ved de Mone rcent) o fined y benef 30 for Retiremen r outdat it pension ed skills (1 32 and a t 3 de perc finent e 28 d contribution ............................ ) played a role. 5 The As previous confidence ov 2009 RCS Source wer the past year abo a data ves of t : Em collect ploye h ee Be RC io nen was fS have it Research fun u fou t aId f nfstitute e n od d, rd by gr ithe amou n an g a c d Mathew Gree ants fro omfnts t orm ta ab h nwald bat le r out work e & Ass t two ireers th me ociate -and-a-ha nt s, I mo ink they nc., 199 st often cite the rec lf doz 3 ne –2009 ed en Rto accumulat epublic a tirement Co ned nfidenc nt private or economic e for a e Surveys. comfort ganizations, able Figure 20 care of medical expenses The level of retirement p A little higlher an benefits decreased 8 6 14 7 28 50 (30 perce • Job loss or c nt) decreased. hange Ot in he emplo r negative yment (10 financial perex cent, not periFigure 9 ences that mentioned in workers report 2008). having in the past year include: 1994 33 38 15 11 2002 Describes respond50 ent not at all 13 15 15 16 17 15 15 7 Figure 17, Americans Having Saved Money for Workers Retirement......................................................................... Figure 16 Retirees ..............18 comparable to the percentages measured from 2003–2008 (Figure 21). retirement pla and the increan s (com e in healt pared h ca with t re ex hpe ose nses, who do American not) and worthose who kers are re expect to porting the ha lowes ve actcess to emplo level of retirey ment co er-provinfi ded r dence etiree Some retirees mention a 2009 mix of positive and negativ13% 42% e reasons for retiring early, but ju22% 22% st 10 percent offer only positive retireme with s uncertai Overall Retirement Confidence •t aff t Confidence n nt co ty, in ime ntinue Much hi flation, donat in to a Importan e gher th and th d specific by E ppear to B an befor e cost of fi RI a tnanci Fa be r n .................................................................................................. d ctors in Pro e al aspects livin Gr ayou r ther eeg as prim nwal low. etired d. rela T m RCS w oting Con ted to ary fa en materials ty-e ctors. retir ightfe percent idence in Inv m In addition, cert an 3 ent also d a lis of work t of decr und estmen eers say they ased. ain ne erwr In iters tgative experi Co parti 7 may mpanies nee cular, th d be toa cces ences, such as job save less than ......................... e perc sed at entage of the EBRI 5 Your home foreclosure 1 0 65 9 Confidence That Medicare Will Continue to Provide Benefits of Retirees You en 199 jo2 y fina ncial planning 24 47 12 14 EBRI’s work advances knowledge and understanding of employee benefits and their Have Saved Currently Save Have Saved Sources of Income in Retirement 2008 18 37 21 22 Sour recorde ce: Empl • d The sinc cos oyee B e the t of Sour e Ver RCS nef livi c ite Res ng is : Empl first ea hi rbega coyee B h gher Inst n askin th it eut nef an e e and M it Res gx this qu pe ea athew Gr cted rchy Inst estion i (9it eenwa p ute e and M rcent, n 1 ld & As 993. Some do athew Greenwa so O wn ciw at nly hfrom es at , I 13 nc15 .perc , 2009 Ret ld & As percent ent o sNot too ociifrement at ) workers in . es, In Conf c., 2009 Ret id the ence 20 Not at all Survey. irement 09 RCS say they reasons. health insurance (compared with those who do not). workers very confident in having enough money a to take care of basic expenses decreas a ed to 25 percent (down loss or a pay We $25 Confidence b s 0,0ite: 00, a www ndcut, loss of re another in Other Fina .ebri.org/ 1rcs 9 p nc e tirement sa rcent ial Aspects o mentio vings, or n a f Retirement goalan increa of $2............................................................................ 50,0se in de 00–$499, bt, almost al 999. Twenty-three perc ways contribute t ent think o loss of confi they ................ need dence 7 2009 Having enou 40% gh mone at Lea y to st Equ 16% al Value to Benefi 13% ts Re ceived b 9% y Retirees Tod 10% ay 12% Figure • 18, An incr Reported Total S Describ ease ines resp the amount aond vings and ent ver they pay in yInvestments, Among well mortgage or NA rent Those (25 Providing a perc 23% ent). Res 19% ponse.......................................... 17% 19 importance to the nation’s economy among policymakers, the news media, and the public. It Money Money Money Wo Figure 21 rkers Retirees 2007 Confidence Survey. 20 46 18 14 Important Important Important Important are very confident they will have enough money to live comfortably throughout their retirement years (down from 2008 take care of medical Describ Ver es resp 51 ondent well y 9 Some 9 NA what 39 6 Not Too 38 13 31 Not at All 12 among tho $500,000– from 4 $9 se 99 who exp 0,99 perc 9, ewhil nt in erie e a 2 nb 007 cout e them. an 1 i does this b dn 34 1 0 p eercent ach b y co e in nducting liev 200 e th 8). ey ne and p In a ed ublishing policy re d to sa dition, th ve $ e 1perc million– entag search, analysis, $1.4 e very 9 mil clion onfident in ha and (8 p special reports on ercentving enou ) or $1.5 gh 2009 75% 65% 62% Attitudes Regarding Financial Planning......................................................................................... (Expected) (Reported) ......................10 What we do 2006 19 42 20 17 Retiree • con Uncertainty a fidence about bout the having a Workers stock financi market (7 a Hav lly secure ing Tried to Calcula percent, not retirement men has als tioned in te o Ho droppe 2 w 008 Mu ). d to ch M a ne one w lo y w. Only 20 percent now The company’s reputation Figure 19, Confidence in Various Types of Institutions.............................................................................................20 The conseque 2007 expences of Describ nses an es resp 32 unplann ondent not too e Confi d early dent 13 retireme well nt can Confi 10 be NA he dent avy. Re 25 tirees 12 Confi who r dent 28 etire ear 20 lier than 30 Confi pladent nned ar 14 e more employee benefits issues; holding educational briefings for EBRI memb a ers, congressional and 27 percent in 2007 and 18 percent in 2008). At the other extreme, 22 percent are now not at all confident they will • A major illness or oth 2008 er medical event suf 72 fered by themselves or an 64 immediate fam 64 ily member (25 percent). money to 200 Socia5 pay l Securit for me y dical expenses fell to 20 38 21 20 13 percent for 81% workers (down from 20 92% percent in 2007 and 18 per- million or more (9 percent). However, savings goals tend to increase as household income rises (Figure 23). Workers 60% They Need to Save for a Com28% fortable Retirem4% ent 7% Reasons for Loss of Confidence .........................................................................................................................10 say they are very confident about having enough money to live comfortably throughout their retirement years (half the RETIREMENT 2006 EXPECTATION 2009 30 S DELAYED: 12 Workers a25% ppar 14 ently e46% 18% 10% xpect to work lo 11 nger because 13 of the econom 21 ic downturn: WorkerDescribs es respondent not at a ll NA 13 14 21 federal agency staff, and the news media; and sponsoring public opinion surveys on employee likely than those who retir200 e 7 66 on time or later than planned to say they 60 are not confident a68 bout having enough money for • The ne An empl ed to pay bills oyer-spons or pay ored r for n etire ement w purchases (6 percent, down from 28 percent). 2004 21 40 21 17 have e Confidence in Other Fi nough money to live comfortably nancial Aspects of Retirement (more than double the 10 percent level in 2007 and up from 16 percent in EndnotesRetire es 59 2009 44% 24 4 11 cent in 2008) and 25 percent for retirees (down from 41 percent in 2007 and 36 percent in 2008). Confidence in Entitlement Progra Figure 20, Important Factors in Promoting m Confidence s in Investment Companies ......................................................20 Confidence in 2005 Over the long r2002009 5% Entitlement8 un—1 Pr 0 43 to 20 ograms years— ............................................................................................. yo36 u 20 33% 34 11 15 7 35% 11 26% .....................12 19 The 41 perc spen ent din lev g level t el in 2h 0at 07 a wor nd dow kers antici nbenefit issues. from pate 29 in r percent eEBRI’s Ed tirem in e 2 nt 008). is relate ucation and Re At th d to e s hame time, ose usehold inco arch Fund 16 (EBRI-ERF) performs percent of reti me. Those with less tha rees are the char not n a it $able 35,0 t all , 00 28 percent of workers in the 2009 RCS say the age at which they expect to retire has changed in the past year. Of 2006 70 64 68 1999 savings plan, such as a 401(k) 16 41 27 15 75 40 basic expenses in retirement. The investmen • An incr t performance ease in their leve of the l of debt (24 200 perc 8 ent). Figure 23 47 200 Perha 8). p s even Forty-one perc more serious t ent report th han th e ey are declinsomewhat e in retiremen conf tide con nfi t, dwhil ence e 2 in2 genera percent l is t are h e decrease not too con in fident th confidence ey w a ill bhout ave 2004 believe stocks in general 2007 49 will be a very41 14 36 10 12 7 17 15 While still not200 high,8 confidence in Socia educa4 l S tiona ecurity’s a l, and scientif bility ic func to30 35 29 maintain tions of the Instit the valuute. EBRI e of bene -ERF fits is a tax-ex paid to retirees a empt organization ppears to 2005 69 62 66 in household i199 n Other person come ar4 e mo alre like savings or i ly than nv high estments er-in17 36 22 21 come workers to 70 think their spending 47 in retirement will exceed their Changing Expectations Abo confident 1 about having enou ut Retirement gh money (st......................................................................................... atistically equivalent to the 11 percent measured in 2007 and ......................13 17 percent in compa those, the vast majority (89 ny’s products percent) say that they have postponed retirement with the intention of increasing their Figure 21, Workers Having Tried to Calc Amounula t of Sav te How Much 2007 43 ings Amer Money They ican WorNeed to Sav kers Think The e for a Com y fortable Retirement ......21 In the RCS, 200 • 2 Not sur retir200 ee refers to individuals w prisingl6 y, workers ov 45 ho erall are who retired or have42 w lost conf ho are a 7 ge 65 or olde iden32 15 10 ce over r an 14 the pas d not emplo t year a yed fu b 19 ll time. Worker refer out having enough 15 s to all individuals money for a goo200 d inv7 estment 6 30 33 28 e bein nou g a ghb money (F le to pay for igur basic es 1 an expenses in d 1-A) supported b . retirement. y contributions Only 25 and g percent rants. of American workers are now very confident that 2004 68 58 65 Nevertheless, An ind worker r ivid eu spon al retireme ses to a nt acco questi unt or IRA on asking the actual a 63 ge at which they expect to a 41 retire has shown little have recovere199 d from2 a slight dip measured in 200818 36 29 15 (Social Security is the federal program that provides income support Workers 200 54 6 33 42 6 7 200 preretir 8) (Fi ement gure 2). spending. On the other hand, those with higher income are more apt to think they will be able to reduce Like retir financi Retirement A • al sec A decr ees, s urieas o ty. me worke gee................................................................................................................. Neverth in the l rs e evel o lare lik ess, the me f rely to e Need tirement dia fifor Retirement, b nd t n (m pla hemselves id-point n benef) its v worker off ulner y e re Hous abl expect d by t e to ehold Income heir an un s to retire or th planne eir s at d p aearly ret ous ge 65, e’s e wit m ireme ployer h...............................13 21 nt for perc (24 hea ent percent pla lth, nfn a of ing to mily, w Sour ho are ce: Empl not defin oyee B200200 Describ ed as retirees, re6 e5 34 nefies resp t Researond cgardless of emplo h Inst ent ver itut5 e and M y well a ythew Green ment status. waNA ld29 36 28 & Ass39 ociates 28% , Inc., 2002–20017 22% 9 Retirement Confidenc 17% 9 e Survey. comfortable retirement2003 71 most often attribute it to the recent eco62 nomic uncertainty (92 percent64 a great deal or they will Havin have g An empl enough mon enough o mone yer-p erovid y to pay y to pa ed traditi y for for basic ex onal penses during retirement (down from 40 percent in 2007 and 34 per- chang Figure Retire e22, sinc es Met e the 200 hod of D 8 RCS. etermining Savi The age at w ngs hich workers Nee 44 ded for Rs ea tirement, by D y they25 plan too retire has cr ing a Retire 6 ment Nee ept upward sl ds Cowly over alculation 23 tim .............. e, from 22 for the aged and disability coverage for eligibl200 e 5 42 workers and their dependents). Six percent of workers are very Household Income their spending200 in r4 etirement. 36 36 16 11 200 Describ5 es respondent w7 ell NA 30 33 28 40 38 31 and/or push on other r those em into th eeir asons. Ther ploye 70s. d Th ). e e is some in median retir di ecation that e actually retir work ed at ers may not age 62, a be taki nd 47 percent ng these factors of retireinto es say account they re whe tired s n they ooner Working for Pay in Retir 200 e2 ment.................................................................................................. 72 Figure 1 61 62 .........................15 long-term care pension or cash balance plan 59 58 EBRI Issue Briefs are periodicals providing expert evaluations of employee benefit issues and The credit rating of the compa some) and inflation an nyd t he cost of livi ng (88 percent). Ho wever, more than 90 percent of those experi encing 2004 42 cent in 2008). However, there has been only a small increase in the percentage of workers saying they are not at all 2 Figure 2 a midpoint of age 1999 34 62 in 19 All 91 to age 65 in 2004–2009. Twenty-six34 percent o $35,00f0 worke –22 rs plan to re8 tire prior to reaching confident that 200 Describ the Soci4 es resp al Second urity system w ent not too 6 w ill conti ell nue to NA provide31 35 26 bene 16 fits of at least 20 equal value to t 31 he benefits Although the RCS does not detec2001 69 t a decrease in the value of the savings and invest61 ments owned by wo61 rkers and retirees, this may be due to These findings are simi Source: Empl lar to oyee B some other Work enef eri Co t Res estimates of Am nfidence in Ha earch Institute and M erv ican ing Enough Mone athew Greenwa household assets. Q ld & Asy so to Liv ciatu es antifi , Ie n c.abl , 2009 e data from the 2007 determi than plann Figure 23, ne t Am eh d. ei 200 ount of Savings American Workers Thin r pla 9 nned retirement a trends, as well ge. For exam as cr 10% ple, itical analy k o They Need for Retirement, by ne mi ses of ght ex emplo 32% pect that yee benefit po worker 26% licies an s Household describing th d proposals. Income eir h 30% EB e................... RI Notes alth as fai is a r or 22 Income NeedsWorkers 53 in Retirement ..................................................................................................... 2003 43 31 8 ........................16 8 Our job loss or a move to a lower-paying job Workers < (95 perce$35,00 nt), a dec0 rease $74,9 in 99 $75,0 the value of re00+ tirement savings (93 per- confident of paying for basic199 Describ1999 4 es resp ond ex Retir penses (11 ent not at a ee7 Confidence in Ha ll perc30 ent, up from 7 NA 24 38 30 ving Enough Mone perc31 21 14 ent 13 in 2007) (Figur y to Liv 17 e 3e ) . 20 age 65; 9 percent say they will retire before age 60 and 17 percent plan to retire between the ages of 60 and 64. received Whil the broad e some respon by retirees to retirees ar se categories used to collect this information. Retireme day, a e fa 200 nt Co ci0 ng nnf d ifina d26 percent ence Sur ncial pr veyessures, many . are 78 somewhat are continu confident ( NA in up g fto dra rom 5w p dow ercen n t savings and investments very 59 and 21 percent somewhat as • Having to 2008 provide significant financial assistance to a 13 family member 31 or friend (23 27 percent). 27 Comfor monthlyta period bly Throughou ical providing cu t Their Retir rrent information on a variety ement Years of employee benefit topics. Survey ofRetire Cones 53 sumer Finances (conducted by the U.S. Federal Reserv21 e Board) found t7 hat median (midpoi13 nt) level of 2002 38 poor would be planning on retiring at a younger age than those in better health. However, those in fair or poor health Less than 1992 $250,000 28% 26 37% 32 25 14 34% 15% Sources of Ret You think pr1994 irement eparin Incom g for retire eComfor ................................................................................................... 3 ment takes too tably Throughou 24 32 37 t Their Retirement Years .......................17 cent), or an increase in level of debt (91 percent) say that these events contributed a great deal or some to WORKING IN RETIREMENT1999 73 : More workers are also planning to supplNA ement their income in67 retirement by working for 2007 17 36 23 21 EBRI’s Pension Investment Report 3 provides detailed financial information on the universe of Twe usual. Ha nty-thr lf ee (5perce 1 percent nt of) wor report the kers say they Ver monthlwill y amount t retirey at hey ag Some withdrew e 65,w wh hat ile 31 percent from savings a Not Too int nend to d investments t retir Not at All e afte or age cover their 65 and A confident long-term in re 2l008ations ). Neverthhip eless, 39 percent of200 1 44 workers are not at all confident that that future Social Security benefits publications householdHavin assets of a $25g 0,00 enou 0–$ ll Ame gh 49 mone 9,999 ricans w y to ho have an 19 asset is $221, 24 500. This inclu 21 des the value o 17 f the primary home, which are actually much time 199 plannin2 g to and e retir ffort e at a slightly 1 older age than their26 45 25 counterparts in better health. 3 Very Somewhat Not Too Not at All 1998 59 NA 59 Worker confidence in having enough money to pay for medical expenses and long-term care expenses in retirement Preparing—or 200 Not— 6 for Retirementdefined b ................................................................................................ enefit, defined 15 contribution, 34 and 401(k) plans. EBRI 26 Fundamentals of Employee .........................18 23 pay. Brian K. Bucks, Arthur B. Ken The perc their loss o entage of wor f confidence. nickell, Trac kers plan i L. Mach, and Kevin B. Moore, “Change ning Confi to work a dent fter th Confi ey reti dent re has s in U.S. Family increased to Confident Finances from 2 72 percent Confident in 2009 (up from 004 to 2007: Evidence Not sur Wop rke risingl rs y, workers with higher household incom 200 48 0 e or highe35 r levels of assets are more 53 8 likely than lo 9 wer-income or • Loosing a job or having to move to a lower-paying job (21 percent). 10 percent say they will never retire (up from 6 percent in 2008) (Figure 11). will expenses in match or th$50 excee e last thr0,00d0–$ the99 e val e9,999 23 mu oe of nths of today 20’08 s bene was the fits. same Confidenc as the amo18 e that So unt cial S with23 edra curity wn w ea ill conti ch month30 nue earl to provide ier in the year. benefits that Repaytire for long-tereDescribs es resp m care ondent ver y well 3% 7% 4% 9% Confident Confident Confident Confident had a median value of $200,000 for those who owned a home. Since then, home values have declined nationwide. 1997 66 NA 50 2005 17 30 25 26 Benefit Programs offers a straightforward, basic explanation of employee benefit programs in from the Su has reach Retiree rve es d r y e of Consumer cord lows. 2009 Retirement C Fin Ju ances,” st 13 percent 2009 13% Federal Reserve Bulletin, of 45 workers ar onfidence e no Vol. 95 (Feb41% w very 29 Survey Underwriters co ruar nfident y 200922% ): A1-A5 about 5 9 bein . g ab22% le to pay for 13 medical 1999 48 66 perc Saving for ent in 200 Retirement 7). This .......................................................................................................... compares with 34 percent of retirees who report they actually worked for pay .............................18 at some time lower-asset w $1 mill o 200 rkers to cite 9 ion–$1.49 savings as a million source o 15% 8 f retirement in 5 29% come, but ma 4 ny of 17% these 14 workers 38% may not be saving at 200 Describ 9 es respondent w 9% ell 50% 8 8 26% 10 12 13% While 14 per200 cent i9 ndicate th20% 47% ey reduced this amount in the last quarter 16% 16% of 2008, a similar proportion (19 percent) say are at least equal to today’s 1996 value is higher among wo 60 rkers age 55 an NA d older than among you 52 nger workers, and 2004 16 35 26 22 the private and public sectors. The EBRI Databook on Employee Benefits is a statistical A recommen dation from a third part2008 18 y 199 8 43 42 21 16 • Workers apparently expect to work longer because of the economic downturn: Twenty-eight percent of workers expenses (do • Home foreclosure $1.5 mil w 200 n from 20 p 8 lion–$1(1 percent .9 millio ercent n in 20 ). 07 and 24 13 8 percent Figure 11 in 1 2008 24 ) and 10 perc 2 ent 22 are very 7 confi 28 dent about long-term 200 Describ 8 es respondent not too 8 well 31 44 32 32 38 36 13 during their retirement. rates nec Retirement Sa essary to provi2008 vings ............................................................................................................. d199 e th5 58 29 35 17 17 e needed income. Lower-income workerNA s are more likely than48 those with .............................19 higher 4 1998 reference work on emplo 12 yee benefit pr33 ograms and work force-related issues. 28 www. 26 ebri.org retirees their Working for Pa Oldermo workers are m nthly withdr ten ore likely tha dy to in awals report Ret in ni workers to creased. Nev higher rement amoun be confi etrtheless, 40 s of assets. dent ab perce oSeventy-t ut the fut nt of reti h uree perc re value o rees in ent o dicate t f Soc f wo ial hrkers un at, so far Security der a in benefits. Retir th geir r e 35 h etirem ave tota ee e nt, their l Workers 2007 27 19919 50 14 16 7 33 43 19 10 It is likely Allstate that this percentage is slightly higher than the actual participation rate, since some w MFS Investment Mana orkers w geme ho do not nt participate in an employer- $2 million or more 6 3 4 8 200 200 Describ 7 7 es respondent not at a 15 ll 27 57 44 33 52 15 22 49 24 42 13 in the 2009 RCS say the age at Planned which th Re ey ti ex rement Age, Among pect to retire has chan Wor ged in kers the past year. Of those, the vast care expenses200 (down7 from 1741 38 10 11 percent in 2007 and 13 percent in 2008). At the same time, the percentages not at all 1994 57 NA 52 1994 NA NA NA NA household incRetirees ome to say that Social2006 24 Security wil10 36 18 33 l be a major 44 source of retirement17 income. In a14 ddition, workers age 55 Employer Plans ................................................................................................................. 1996 29 ...............................20 spendi More work savings an ng on d i ers h ne are also valth c estments of are plan has be ni le ng to ss than en supplem higher $25,000, the an e nt th compar xpecte eir inco e dd .m Ju w e in ith st retir 45 8 perce pe em rce n ent of nt t say he by worki older alth n wg care spending has o for rkers. At th pay. The e RCS same time, been has co low 2 ne s0istently r tha per-n confidence a sponsored retire American I bment savings pla out the valu nstitute of Certi e of Socia n ar fe not a ied Pl S uw blic e are cu Accou rity benefits h of their eligibility ntants .as also recove PIMCO red from the slight dip measured in the 2008 RCS GREATER WO Don’t kn RRY ABOUT 2006 ow/Do BASIC AND n’t remember HEALTH EXPENSES: 22 11 Workers 10 33 who say they 10 25 very confi 8 dent 16 in having enough Sour200 ce: Empl 6 oyee Benefit Resea12 rch Institute and Mathew Greenwa 50 ld & Associates, I 26 nc., 1998–2009 Retirement 10 200 Before 6 40 33 12 13 Age Age Age 66 or Never Don’t Source: Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc., 1994–2009 majority (89 percent) say that they have postponed retirement with the intention of increasing their financial 1992 NA NA NA NA confident about these factors have remained comparatively steady over the past year. Twenty-two percent report they Media reports 2005 199 25 5 32 40 17 17 Contact EBRI Publications, (202) 659-0670; fax publication orders to (202) 775-6312. and older are more likely than younger workers (particularly those ages 25 to 34) to say they will rely on income from Bank of Sour Confidence Surv Ameri ce200 : Empl 5 ca oyee B eys. enefit Research Institute and M 23 athew Greenwa 30 Princi ld & As pal Fina sociatesn, I c 19 ial Group nc., 2009 Retirement 24 found that Retirement Sa approximate 2005 vings Needs ly two-thir ....................................................................................................... ds of 20 workers plan to work for 42 pay after they r 24 etire, but this percentage has .........................21 9 increased (Fi anticipat cent of work gure 8e)d. . ers age 45 an Age 60 d older cite a60– ssets of 64 $250,000 or more ( 65 versu Older s 6 percent of yo Retire unger workerKno s). As on w e might money to tak 200 e care 5 Retireme of basic nt Conf expenses in 40 idence Survey re s. tirement 40 dropped to 25 perce 12 nt in 2009 (down from 7 40 percent in 2007), Workers who have lost confidence over the past year about having enough money for a comfortable retirement most Source: Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc., 1992–2009 Retirement Confidence Workers 2004 199 14 24 4 44 43 31 18 19 13 24 security. Nevertheless, the median (mid-point) worker expects to retire at age 65, with 21 percent planning to are not at all confident a about payin Subscriptions to g for medical ex EBRI penses Issue Bri in re efs tirem are included ent (up from as part of 14 percent EBRI membership, or as part of in 2007 but equal to a 2008) Confidence Survey. 200 200 4 4 16 30 37 23 18 31 27 11 Capital Research and Management Company Rockefeller Foundation Social Security200 2009 4 . The addition 9% of 42 the phrase “and17% 23% /or your sp 27 ouse” to the question w31% 10% 16 ording for married respo13 ndents 6% Orders/ to 72 suspect, total percent Survey isavings and investments incr sn . 2009 (up from 66 percent i en ase shar 2007 an ply d 63 with perc househol ent in 20 d in 08). come It shoul and with education d be noted, ho . wever, Workers wh that th o e RCS have RCS Meth a odology .................................................................................................................................................23 while Retire onlyes 13 percent feel very conf 2003 ident about 11 21 having enough to 45 39 pay for medic 17 al e17 xpenses (dow 16 n from 29 20 percent in often attribute this loss of confidence Sour to t ce: Employ he rece ee Bene nt econ fit Resea omic unc rch Institu ertaintty (92 e and Mathew Greenwa percent a great ld deal or some) and $199 annual subscription to EBRI Notes and EBRI Issue Briefs. Individual copies are available 7 percent of respondents did not report their income. They are included in the total column but not in the push on 199 into 8 their 70s. The median retir 19 ee actually retir 28 ed at age 62, an 24 d 47 percent of retir 24 ees say they 1999 starting in 1999 is respons 12 ible for approximately 4 t 39 o 5 percentage points of36 the increase between 12 and Deere 30 percen & 200 Com t indicate they 3 pany are 39 not at all confident 35 about long-te Russell Inv rm care e 12 e xstment penses G (up from roup 11 21 percent in 2007 but Higher-incom 200e 8 workers a11 re more likely th 21 an those with lo 24 wer income to agre 30 e that stocks will 6 be a very good 7 Workers may be failing to take health care costs sufficiently into account when estimating their retirement needs, but Worker concern about Medicare’s level of benefits continues to be relatively stable (Medicare is the federal health care & Associates, Inc., 1994–2009 Retirement Confidence Surveys. has also fo Source: Empl und consistently t oyee Benefit Researh ch 200 at far Inst 2 it f utee and M wer rea tirees a thew Gr 23 c eenwa tually ld work & As 47 so for ciatpay es, I at some t nc., 2009 Ret 19 ime irement durin Conf g t10 h ideir enc retirement e Survey. (34 per- done a re intire come gro ment savin ups. gs needs calcul with prepa ation y(compar ment for $25 each ed with thos (for printed e who have copies not ). Change of Address: ) tend to have hig EBRI, 1100 13th St. her levels of savings. Endnotes 2007. Amon ....................................................................................................................... g retirees, only a quarter (25 percent, down from 41 percent in 2007) feel very confident a ......................................23 bout covering inflation and the cost of living (88 percent). While the overall effect of each of the events listed above is smaller, their 199 199 4 1998 and 4 1999. 13 NA 30 NA NA 26 NA 21 200 2007 2 17 21 40 a 32 27 24 16 6 11 5 ELM Income Subscriptions retired sooner Group than planned. Schering-Plough Corp. statistically equivalent Some workers have not yet to the begun to 27 percent build the measured sources o in 2008). f income from which they expect to draw income in retirement, The addition of the phrase “and/or your spouse” to the question wording investment over the long run. Co2001 22 nversely, the likelihood of agreei41 ng that somethin18 g always hap17 pens to set them back insurance pro the 2009 RCS gsuggests that ram for the elderly some workers and disabled). may be Five grad percent o ually reafd workers are justing their very expect coations abo nfident that th ut the Medicare system e likelihood of NW, Suite 878, Washington, DC, 20005-4051, (202) 659-0670; fax number, (202) 775-6312; ce In additio nt in 20n 09 , th 199 ) ( 199 ose who F2 ig2 ure 13 have ). saved for 10 retirement a NA re more like 28 lNA y than those whNA 39 o have not saved to NA have 17 substantial their health 200200 expenses. 6 1 13 37 37 10 11 20 27 25 7 7 effect on those who report experiencing them is quite high. In particular, more than 90 percent of those experiencing FINRA Investor Education Foundation Schwab for married respondents starting in 1999 is responsible for approximately 2000 25 47 18 10 while others appear to be relying o e-m n empl ail: oyer-provi subscriptions@ebri.o ded bene rg fits th Me at, i mbe n real rship Information: ity, they are u nlikely Inquiries reg to receiv arding EBRI e. financially increases as household incom e decreases. Younger workers are more apt than older workers to think that The likelihood having access Source: Empl to employ of citing t oyee B h er-provided h e c enef ompany’s r it Researce halth Inst eputation, i insuranc itute and M nvestment ea thew Greenwa when thperform ey ret ld & As ire ance, a (36 percent, down sociates nd cre , Inc., 1992–200 dit ratin from g is hi 8 Ret 41 igher rement percent in amon g t 2007 an hose wit d h will Sour contin ce: Empl ue t oyee B o provi enefd ite Res ben eae rcfits of h Instit at ute and M least equal val athew Green uewa tol dthe & As be sonef ciaties ts , I receive nc., 1992–200 d by re 9 tirees today, Retirement Confidenc while 3 e Sur 3 perc veyse . nt are 2000 34 41 14 11 2005 16 19 26 24 6 9 levels of savings. In fact, 57 percent 4 to of 5 perc workers entag who e poin ha ts of ve not saved the increase bet for retirem ween 1998 and ent 1999. say their assets total less than job loss or a In genera Gen • More work wl, orth de move to a Fi creases in naers ncial are also low con efr-paying job ide plan nceni in ng to thes (95 supplem e spec perce ific n et), aspe nt th a dec eir cts of ret inco rease m Smith Ba e in iin reme the valu retir nt by rney em e o demo ent f rby worki egr tirement aphicn subgrou g savin for pay. gs (93 p fo Th llow pe e percenta rcent the same ), or ge an 1999 22 47 21 9 In light of these changes, it is not surprising that workeFigure 13 rs’ confidence that they are doing a good job of preparing membership and/or contributions to EBRI-ERF should be directed to EBRI President/ASEC HOW WORKE Confidence Surv RS ARE RESP eys. ONDING: Among workers who have lost confidence in their ability to secure a comfortable Figures at least anyone ca $3200 n 5,0199 ha 4 00 9 ve a com in househol forta 16 d in ble31 39 20 retirem come th ean nt 21 if among those they just plan 26 with an lower d save. inc Larger shar omes. Moreo 22 es v of men er, recomme 6 tha8 n women a ndations 9 gfrom ree th a thir at d somewhat statistically equivalent confident in to 3 the s 4 y perce stem. However, 61 nt in 2008). Forty-one percent are percent of reti not too (35 perc rees state t ent) h or ey have a not at allccess (26 p to healt ercent) confid h insurance ent Not al $1,0Goldma 00. l worker n, Sac s who hs & Co. have saved 199for ret8 22 irement are currently savin45 Segal g for this Compa purpose.18 ny Sixty-five 13 percent of workers Chairman Dallas Percentage Working for Pay Salisbury at the above in addr Retirem ess, (202) 659-0670; ent e-mail: salisbury@ebri.org increase pattern as for of work in lev e retireme ers pl l of debt annin nt co (91 g to nfidence perce work nt) say t over after t all, w h hat these ey r ith l etir arge e eve has r dec nts contribute increase lines occu d to rring among t d 72 a percen great deal t in h or 20 ose ages 4 09 some (up to t fr5 om 66 h and o eir loss of percen lder an con t in d those fidenc 2007e . financi For i Younger nstance, ally work for 77 ers think their r perc eent o tirem they fe workers say th nt has will nee gradual d more ley are expect y dec money line in d ov retier the n irement. g retirem past tw In ent income from particular, o years. Wh work ile the ners un on-work percent der place age age o savings 55 ar f workers e leor ss likvery ely 1991999 8 17 24 19 28 24 24 31 18 5 5 retirement, most (81 percent) say they have reduced their expenses, while others are changing the way they invest Figure 1, Worker Confidence in Having Enough Money to Live Comfortably Throughout Their Retirement Years........... 5 anyone can have a comfortable retirement, they enjoy financial planning, and stocks are a good long-term investment. party are mor through an em eployer, apt to be im but many em portant to 1997 ploye wor rs are kers und 24 eliminat er ag ing e 4healt 5 th 41 an amo h care covera ng older 19 ge work for futur ers. e retire 15 es (Figure 15). The that Me likeli dicare hood ’s ben of doe ing a r fits will eti continue rement savi to ngs nee equal ord exc s calcu eed la th tie on inc benerease fits re sceived by with househ ben old i eficiari ncome, es toda edy. Agai ucation,n, an wor d the ker IBM Towers Perrin Workers Retirees report that they and/or their spouse are currently saving for retirement. This percentage has fluctuated very slightly with Surprisin househol and gly, 63 percen given th d income o e n t in atio f 2008). $35,0 nal atte 00 Th or mor ntion is compares re e. ceivedwith 34 by the decr percease ent ofin re htirees wh ome valuo report es, workers saying they actually the valu worked for e of th pay at eir than ol der199 wor 199 4 7 kers to think 22 th 33 ey need to a 28 ccumulate 34 less31 than $500,000 for 18 11 retirement. <.5 Workers 11 who do a 8 retirement investments, y confident that e they are t only 56 do per ingc a ent r good jo eport b ha prving t eparin hg ese ty remai pes of sa ned at a vin stabl gs. e Workers are statistically as li 25–26 percent between 2004 a kely to expect nd 2007, it fel that l their money (43 percent), working more hours or a second job (38 percent), saving more money (25 percent), and 1996 19 41 23 16 Mass Editorial Bo Mutual Financial ard: Dallas L. Salisbur Group y, publisher; Stephen Blakely, editor. Any views Vanguard Gro expressed in this p up ublication and those of the authors should confidence Just one-quart about the er of workers future (24 percent) a value of Medicrare bene e very confi (Plan fits is d ned) ent that higher among those a they are inv(Actual) esting t ge 55 h eir r and o etirem lder, an entd retirees are savings wisely more amount of sav Changing Expectations About Retireme ings and investments. In addition, married workers a nt re more likely than unmarried workers to have tried Figure since th 1-A, e RC199 199 RC S 1 6 first measure S Trends: Wor19 31 d26 it i ker Conf n 200idenc 1, reaching a e in Havin 42 low g En o34 11 fough 58 perc Money t ent ino 20 20 Live Com 04 and a fortably high oNA Throu f 65 8 perc ghoeut Th nt in5 this ye eir ar’s home decli some time ned over th during t e past heir retirement. year were much less likely to attribute their loss of confidence to this particular factor (69 they w needs to 20 percent calcul ill recei at in the 2009 RC v ion are e retire more ment li income kely than S. 199 The percentage o 5 from a thos de e w fin 21 ho ed be do f worker not nef to estimate t it (or s not at a 51 “traditio ll co hn at they al”) nfident r pension 19 need emain higher plan ed stea (59 amounts perc dy 8 (1 en 4 .t) as perce retire nt, es are to not be ascribed to the officers, trustees, members, or other sponsors of the Employee Benefit Research Institute, the EBRI Education and seeking advic Workers expee cting be from anef financi its from al pro a de fessional fined bene (25 fit pe percent nsion ). Am plan ong al are m l wor ore apt kers, 75 percent sa than those not y they expecting suc and/or their h benefits to spouse Mercer 2009 72% 34% (do Whil we r n from etire 199 e c 45 percent 5 onfidence in abo 1998). ut bein 26 Anoth g able er t 54 percent o afford 47 basic are ex somewhat penses an cd onfident t 18 having don hat t e a heir savin good job o 6 gs ar f prepari e wisely inv ng fina ested. ncially to do o likely tha ne. Sour n wor Workers age 45 ce: Empl kers to be confident. oyee Benef and o it Reslder ea Even s rc h (co Inst mit o pared with y ut , the e and M proport athew oung ion of retirees Greenwa er work ld & As ers), retir s very ociat confi ese , I ment ncd.e , 1991–200 nt savers (compa in the va 9 Ret lue irement o red f the Confidenc with future nons eavers), Retirees tend to express higher levels of confidence than workers about each of these financial aspects of retirement, RCS Resear (butRetirement Years, 1998–2009 is st ch Fund, atistically un or their staffs. ch Nothin anged fr 1994 g herom ein is to be co .................................................................................................... the 64 perc 20 nstrued as an attem ent measured 45 pt to aid or in 2008 hinder ). the adoption 17 of any pending le 17 gislation, r ................ egulation, 6 Retirement Age percent) (Figure 7). receive it statistically equivalent (58 percent). to th However, e 13 percent 200 only 8 41 percent measured i of worker n 200 63 7 an s report d 12 p t erce hey an nt measu d/or 25 th red eir spouse cur in 2008). rently have this type have save think they w Surve d m ill yo shave ret ney for . retir iree h ement, on ealth cove of erage. Oth the high eest lev rs who more els ever o meas ften say they ured by the will r ReC ceive S. this type of coverage include 1994 27 37 21 13 Reasons for Loss of Confidence Employer Plans for retir or interpretative ement is similar to rule, or as legal, levels foun accounting, d actuarial, o in the 200 r other such prof 8 RCS, they rema essional advice. in well below those observed in 2007. A third bene Part of fits paid by the reason for t Medicare his la reck of co mains belo nfidw the ence may level be m tha easured t both in workers 2007 (9 p and ercent, retirees down lack confi from 15 dep nercent ce in s in ome typ 2007 and es of and participants in a defined contribution 1993 plan 18 (compared wit55 h nonparticipant19 s and those not o 6 ffered a plan) more but th •ey too Workers show a who marke have lost co d decline nfi in denc con e in fide th neir ce. In ability to particular, t secureh a com e percenta fortabl ges of e retir retirees ement say they a very confident re respondin about g by Despite speculation that workers may hesitate to do a retirement savings calculation because they are afraid of being 2007 66 37 Perhaps in response to their loss of confidence about their retirement finances, workers report they are adjusting some of plan with 199 a 3 current or prev 27 ious employ ASEC er, so the Charter 45 diffe Partners rence of 17 perc 16 entage points may be 7 expecting to receive the workers with income of at least $75,000 (compared with lower-income workers) and those who are married (compared Although the RCS measured a 5 percentage-po Source: Employee Benefiint t Resea decr rch Ins ease tbet itute and Mathew Greenwa ween 2008 and 2009 ld & Associate in the percenta s, Inc., ge of workers who One of the primary vehicles very that work confid ers u ent about se to save havin for g enough mon retirement is a ey to pay n employer-s for basic ex ponsored r penses etire (do ment savin wn from 4 g8 s per- plan, Not sur (34 percent) o financi Figure 2, Retir ap l i risingl nstitutions. Just e fy retir e , the Confidenc elikeli es arh 3 perc e ood of e in Having Eno ent o having saved f workers and 2 percent o ugh Money to for retirement Live Co amon f ret mforta g irees report both workers bly Throughout Their Retirement Years they an are d reve tire ryes is confstrongly re ident aboulate t ........... d to 6 often r statistically equivalent eport trying to do to 8 a c percent alculation. in 20 08) (Figure 9). IGNORANCE STILL A MAJOR FA200 CTOR: 6 Many workers still 67 do not have a good ide 27 a of how much they need to save for having eno taking some ugh money steps to to pay for m improv ee the dical iand r situatio long-term n. Most care (8 expenses durin 1 percent) say th g rey have etirement hav reduceed t decreased sharpl heir expenses, whil y. e discouraged by the r Source: Employee B esults, t enef hose w it Resea hro hav ch Insteit do ute and M ne a ret athew Greenwa irement nee ldd & As s calculation sociates, I co nc., 1993–200 ntinue to 9 be Ret more like irement ly than those of the AARP ir expectations about retirement. Twenty-eight percent of MetLife workers in the 2009 RCS say the age at which they Although the median retirement age for retirees in this survey has increased from 59 in 1991 to age 62 in 2003, a gap benefit from a future emplo 1993–2 yer—a scenari 009 Retirement o that is Confid beco ence Surveys ming 4 increasi . ngly unlikely, since private-sector employers in with unmarri EBRI Issue ed Brief wo isrkers). registered in the U.S. Patent and Trademark Office. ISSN: 0887 -137X/90 0887 -137X/90 $ .50+.50 such as a 401( are very confidk) ent . Seventy-eigh about having t pe200 enou5 66 rce gh nt money for of eligible a c woo rk mfortable ers (44 perc retirement, ent of all the proportion o workers) say they 26 f workers who participate in feel that such a cent in 2007) and 28 percent are very confident about having done a good job of preparing (down from 39 percent in household inc investment Confidence Surv coome. mpanies, compared with 21 percent The eys. proportion saying they have sav of worke ed rfo s a r r ne d 27 tirem pe ent also rcent ofincrea retirese es as educati s who are veorn levels rise y confident about or retirement. Only 44 percent of workers report they and/or their spouse have tried to calculate how much money they Twenty-five others are cha percent of retirees no nging the way w say t they hinves ey are t th very eir mon confident ey (43about percent havin ), wor g enou king mor gh money e hou to rs or a s pay for m econd edica job l who have not to Fidelity Investments say they are very confident about having a comforta Prudential Retirement ble retirement (19 percent vs. 9 percent). expect to retire has changed in the past year. Of those, the vast majority (89 percent) say that their expected Figure 3, Worker Confidence in Financial Aspects of Retirement................................................................................ 8 particular remains betw haveen worker e been cuttin ex gpectations back on thand the experi eir defined ben enc efie t off of current r erings. etirees (Figure 12). Workers who are not 2004 68 32 Instead o they have plan, and the l f lost doin confi ikelihood of participati g a systemati dence in c their ove retirem ne rall g inc nt re nre etirement eds ca ases as hou lculatio prosspects over n ehold , 44 perce income the nt or e past yea of work ducatio ers co r is n much h rise. ntinue to igher. gues Twe s at how nty-on muc e percent h they not at all confident about basic expenses (9 percent) health banks (Fi 2007). status i Ho gure wever, only 19). mproves. I This lack a few ret n a dditio of co irees nfi n, marri ddes encce ribe ed wo in investment thems rkers are elves as co mo mpan b re likely th eing ies is widesprea an those not d bu married to ha t is particularl ve set mon y apparente am y aside. ong InCharge Education Foundation will need to have saved by the time they retire—and an equal proportion (44 percent) simply guess at how much they expenses, co (38 perce mpared with nt), saving 41 percent more money (25 in 2007 an percent), d 36 perc an ent in d seeking advic 2008. Similar e from a ly, 15 financi percent say they are al professional (25 perc very confident ent). Moreover, those who think they need to accumulate at least $1 million in retirement savings are more than twice as retirement age has increased. While these may seem to be large percentages, they are similar to those reported in 1999 66 27 confident about their financial security in retirement plan to retire later, on average, than those who express will need to accumulate. Approximately 2 in 10 each report doing their own estimate (26 percent) and asking a Figure 4, Retir report that they are now ee Confidenc mu e cin h le Financial A ss confident spects of Retir about having ement enou ................................................................ gh money for retirement than they were in................ January 9 or their preparations (16 percent). Other those age 55 and groups of work older. ers more likely to have saved for retirement include those age 35 and older (compared with will need for a comfortable © 2009, Emplo retirement. yee Benefit Research Institute -Education and Research Fund. All rights reserved. Sour about payin ce: Emplg oyee B for long-term enefit Resea c rc are h Inst expenses, compared wit itute and Mathew Greenwah ld & As 27 perce sociatnt i es, I n 2 nc.007 , 1999–200 and 24 9 perc Retirement ent in Confidenc 2008. At th e Surve sa eys. me likely as those who think they need less than $250,000 to be very confident (22 percent vs. 10 percent). ebri.org A research rep ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri Issue Bri ort from the EBRI e e e e e e e e e e e e e e e e e e e e e effffffffffffffffffffff • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 • April 2009 • No. 328 Education and R esearch Fund © 2009 Employee Benefit Research Institute 15 23 19 17 18 16 22 21 20 10 13 12 14 11 8 2 7 4 3 9 5 6

Volume 328

Pages 24

EBRI Issue Brief

Ruth Helman

Craig Copeland

Jack VanDerhei

Retirement