Americans’ confidence in their ability to retire appears to be stabilizing, now that the economic volatility of the recession has abated, but their self-described preparations for retirement continue to erode, according to the 2010 Retirement Confidence Survey (RCS) released by EBRI and Mathew Greenwald and Associates. However, the RCS also finds that a growing number of American workers are also planning to delay retirement—which has negative implications for the U.S. job market, where unemployment is high and layoffs continue to grow. As older workers stay at their jobs longer, the RCS results suggest that fewer existing jobs are likely to open up.

20TH ANNUAL RCS: The 2010 Retirement Confidence Survey—the 20th annual wave of this survey—finds that the record-low confidence levels measured during the past two years of economic decline appear to have bottomed out. The percentage of workers very confident about having enough money for a comfortable retirement has stabilized at 16 percent, which is statistically equivalent to the 20-year low of 13 percent measured in 2009 (Fig. 1, pg. 7). Retiree confidence about having a financially secure retirement has also stabilized, with 19 percent saying now they are very confident (statistically equivalent to the 20 percent measured in 2009) (Fig. 2, pg. 8).

Worker confidence about paying for basic expenses in retirement has rebounded slightly, with 29 percent now saying they are very confident about having enough money to pay for basic expenses during retirement (up from 25 percent in 2009, but still down from 34 percent in 2008) (Fig. 3, pg. 9).

PREPARATIONS STILL ERODING: Fewer workers report that they and/or their spouse have saved for retirement (69 percent, down from 75 percent in 2009 but statistically equivalent to 72 percent in 2008) (Fig. 11, page 14). Moreover, fewer workers say that they and/or their spouse are currently saving for retirement (60 percent, down from 65 percent in 2009 but statistically equivalent to percentages measured in other years) (Fig. 13, pg. 15).

MORE PEOPLE HAVE NO SAVINGS AT ALL: An increased percentage of workers report they have virtually no savings and investments. Among RCS workers providing this type of information, 27 percent say they have less than $1,000 in savings (up from 20 percent in 2009). In total, more than half of workers (54 percent) report that the total value of their household’s savings and investments, excluding the value of their primary home and any defined benefit plans, is less than $25,000 (Fig. 14, pg. 16).

CLUELESS ABOUT SAVINGS GOALS: Many workers continue to be unaware of how much they need to save for retirement. Less than half of workers (46 percent) report they and/or their spouse have tried to calculate how much money they will need to have saved for a comfortable retirement by the time they retire (Fig. 23, pg. 22).

AMERICANS EXPECTING TO WORK LONGER: Although the age at which workers report they expect to retire shows little change from 2009, a longer-term look finds significant change. In particular, the percentage of workers who expect to retire after age 65 has increased over time, from 11 percent in 1991 to 14 percent in 1995, 19 percent in 2000, 24 percent in 2005, and 33 percent in 2010 (Fig. 29, pg. 28).

INSTITUTIONAL CONFIDENCE LAGGING: Americans continue to lack confidence in institutions. Just 19 percent of workers and 22 percent of retirees report they are very confident about banks, while 12 percent of workers and 13 per-cent of retirees say they are very confident about insurance companies (Fig. 19, pg. 19). They are most likely to express confidence in private employers (23 percent of workers and 27 percent of retirees very confident) and least likely to feel confidence in the federal government (11 percent of workers and 8 percent of retirees) (Fig. 20, pg. 20).

Figure 37, Figure 3, Retir Length of Re ement Savings Worker Confidence in Having E Expected (Worke tirement Needrs s) vs. Actual nough Money (Retirees) Pa to rticipatio Pay for Ba n in Employer-Pro sic Expenses in Retirem vided Retiree ent Health ............................ 9 Employer-s Ruth H Retirees Again, Workers (54 percent), • • Many workers e worker ten lman Family, who po d i ns have changes at t to ex sconfidence research ored r friepress hi done nds continue etire , or co-worker a r dir a h ment s gher l b eir com e eout the tirement ctor for to ea be vels o vin p fut una any, Math savi s g (2 su f c plans ware re 7 su ngs n o ew perce value o nfidence ch as of may Green eeds h ndowns o t f be Me w muc of work w tha F cal iald & gure 24 amon dic c n izin ulation worke are benefits is hers, 17 perc th g Associates. Craig Copelan g t or ey nee h rclosur e mo also t s abo dst eff e to e (26 percent und to hav ent o t eac higher save ective v fh r of e for retir among those a t the e irees). h ehicles avai ) ig s , and havi d e fina her e is senior r ment. sa ncial vings Less tha labl ng t g as e 45 e e for goals than search associat pects of o care and o enco n ha for a retir lder, uraging lf do of spouse or e an worke workers ment, e at d rs Use o Confidenc f Guar e in Entitlemen anteed-Incomt Programs e Products Insurance ..................................................................................................................... Figure 3 ................................ 34 Figur Fi F Figure 8 Fi igur ggur ure 33 e 28 e 10 e 5 the Employee Benefit Resear Mech thoInstitut d of De (EBRI). etermini n Jack g Savi Va Fi Figur Fi Fi Figur Fi Fi n Fi nDerh gur gur gu gur g Figure 29 g gur us r re 20 e 1 e e 35 e e 34 eN e 30 38 47 44 e eed 8 i is the research ed for Retire director at EBR ment, I. This Issue Brief was The 2010 Retirement Confidence Survey: Figure 41 retirees and t another workers to sav who have not done he (4 are m 20 family 6 pe 10 rRCS f o c member een re likely tha for t) retir re inds the p o that calcu e (19 rme t th npercent). workers to the nt. e lation. y and marked declines Whi /lo T e t Oth rw t be conf h ent he ee iRCS y r sp rs say chan -eight perce ou does not ident. Ev of se h prev ave t ges in t n di ious en so, the t rstinguish ho of workers w ie years hav d to c he skil aper lc ls required uw muc lc e ah entage of retirees halt te how o have ed. h mon mu for t Aft done a ch e h ey is saved in eir job r decr mone calcul very easin y th (16 percent ation, compare conf eg y e f w r aident om 48 ch type of ill nee ) in or percent d the to h oth d wit sa va ear work vings ve hlue o in just - f Figur Figur Figure 39 e 17 e 11 Figure 4, Many workers The length Worker Confidence in Having E of retireme continuent is a to be key com unawarep of one hnough Money n ot of w muc retirem h they nee Figure Figure 14 Figu Figure 13 ent pl to re Pay for M anni d 15 27 tong, save an edical Expense for retir d many Ame ement. ricans re Less tha s in Retirement port t n ha aking lf of ........................ worke it into rs (46 9 Figure 1 Figure 2 Although Workers may prod be ucts and retir less likely teoment expect W plan o than rker opti retirees C ons that onfidence are to provi in d receiv H e a guara vie i ngn ntee com Enoug d income e from h M Social o eac ney h tSecurity o month for beca life uscan h e confi elp to e dence nin sure written with assistance from Expect the Institute’ eCompar d Re ( W W t Reti R W io r ork A e e rk o t t eit r er ree r T iiker e C t s ee r ude A r s Repor on en o ) v s n Con Co Conf of s d fresearch id . inf A n bout e P fc W in iden ild t tua d anned c ien ng ence i o e r S l an Th kers’ ce ce t T (ocks R h a d ieti in H e ( n tn W editorial S y Hav E H r orker Post ee o x as a a c pected v v ) iia iia Sound So ng ng ng lpo s) staffs S urce E e Enough ned D ac n one n R u o d e rity . Any views expressed in t s ugh T ti A Io a h r n c f e ei v Inc tual Will C m Go M est Money r Exp eoney od nt o ment (Reti me A o ect Jn g ob to in Retir tt e r o ie n ees) d u e emen his t report are those of • Newspap Reasons f ersT o rend in r maga or W zines Po orki st b ( -Ret y ng f 10 D Fa T o v perc ir o r io end R n r Pay ement r/ g eO ent o a tir ppose Change in ee C R i Ret e v n fti s workers, 8 per Ret r. o e iPre- r nf men ees’ irement ide FiR g t u n A e N rce ti c e eed rem t s 37 u , ital A n o c s C m ent of reti e ISoci Ret n nt Spendi ong st alc iir tu al e uti Ret lm ati Securi o e rees). ns o int rees W n n A g,g tA y emh ong o W W orked f orkers or Pay Workers Expecting Retirement Income From Savings and Employment related reason vehicle, 200 the f 8 percent 7 to uture saved by worke 34 of ben p t eh rcent i r s (11 eose w s who c fits the t paid by percent) played n h i me they retir o hav 200 u R rre e8, tiree ntly partic Medicar ethe not, Confidence That perce estimat e Work e W so that rem a rol ipate o nrke tag ers a e e i ins below .r e they Some retir n s Expect they of this ty Havin retir ne can liv ed to pe o ees Ret g the S ing e a ive leve fe rement es accumul ve plan Reti comfo ry mention d M conf l measur are almo re o rment Sav tably ne ide ate a posi y n ie t i ngs A for R t d iIn st three times least n ncom in tive reasons havin ret 2 e ire 0 rti e $1 m 0 e From rem ment (Fi 7 g In (7 enou villi e est percent, nt on for for retiri gh mon as likely as ed gurW e 23, pag retir idow sely ng earl ey to em th n , pay for e fr ose who e 22 nt. At y, such as om 15 ). the percen basic do ot bei nher on t in t g Figure 38, Expected (Work Worker er) vs Conf T To otal tW ia . Ac dl o e Sav Sav rkers n tual (Retiree) So ce iings and Inv ngs inCurrentl A and bilityInv ty o est estments Sav urc Accum m e ing Money se of Inc ntu s R la Repor to e eme in Retirement Neede po for Retirem rt ted by ed d by R R e W te io rte e irree k m nt ............................................... ee rs nt s, , Savings, 35 percent) repor consideration when t they a they nd/or t do their fina heir spouse ncialha plann ve tried to ing. I ca n th lce 200 ulate 8 RCS, 66 perc how much mon ent ey th of workers ey will nean edd 4 to have 2 percent saved of by the retirees Worker Confidence in Having Enough Money to Retiree Confidence in Having Enough Money to Figure 5, Worker Confidence in Having E Pay nough Money for Basic Ex to Pa penses i y for Long-term Care Expens n Retirement es in Retirement ......... 10 the aut Social S that retir heors an ees curity do not out ’s abi d shoul lity to ma d live t not be ascribed to hintain t eir assets, Pay h to e Pay f of valu Pr ofew people mak Pre rRet ov Long- t for e of hie officers, tr p d W i M ra e e bene o rm e Be irk f tn di e ent g rnef cal m o fits paid F r A iCar Exp ina P t g e s ustees, or other sponso a e of at n use of t y e ic n e iia to Expenses n Pa nses Reti ll retir y Lea st h fo 12 em. rement in e r ses t Re M Reti Just Eq is low io tire nua nt rRet e hs me 14 perc lm V (Soci ie a rnt rs of EBRI, EB e n lu ment te aent of retir l Security RI-E is the ees report RF, or federal thei they pro r st gaffs. ram Expected ( (m Wult orik pe ler res s) vpons s. Aces tu al ac c (R ept ete ird e)es) Participation Confidence Stabilizing, But Preparations Continue to Erode ASocia mong l Secur Those itHa y and Defi ving Sav ned ed fBenef or Reiti t Pl rem ans ent byA D m oong Those ing a RetireProv ment iding a Needs RC ea slponse culation expenses has partici able 200 extreme, 7) an to a pate to fford 1 d 9 49 percent report tota remaine perce an ear n of t lt of y retir d stea re h l sa ose w e tivings an ment rees report th dy at ho hav (24 34d perce perc e investments of at A done a m ey are ent) or n ong Those Prov t in calcu 2not too 009 wantin l an ati o d 33 or lg e n, co ast $5 to not pe iding do somet mpar at al rcent 0,0ed 0 a R l c 0 in (56 o with hing else nfident esponse 201 perc 39 0. perce At th ent vs. (Figu (14 e n r perce e 4 t w same 19 6 h). percent o hav n t), time, 25 but e n ) just 5 . Furthermore, ot, think t percperc ent continue hent ey need to offer to Live Comfortably Throughout Their Retirement Years time th said they cons ey retire idere so that d th they e number o can live comfo Live C f yea omfortably rs they rtably i (and the n T ret hro ire ughout ir spouse ment. This is comparabl Their ) will spend in Retireme retir nt e e to Y ment. ear the perc s entages measured from Figure 39, Workers Expecting Retirement Income from Social Security and Defined Benefit Plans ........................ 36 Neither EBRI nor EBRI-ERF lobbies or takes positions on specific policy proposals. EBRI invites comment on this • Information available over in t Em he i ton p B tern loy ene et erfits -(10 pe Pr o R ve id c rcent e eiv d e R of workers, 4 d e b tiry e e H Retire eale th s perc T Ino su d ent of retir a ry ance ees). March 2010 • No. 340 S trongly Favor Somewhat Favor Somewhat Oppose Strongly Oppose Don't Know/Refused purchased a that provides fiinancial ncome replac produc ement for t or selected a eligib retirem le aged an ent d pldi an sa optio bled work n that er pays th s and their em d gu earanteed i pendents). n co Se me eac ven pe hrce mont nt of h for Figure 6, • The Worker Confidence in Doin savings goals cited by workers w g a Good ho have Job of done Preparing Fi a retirement nanci nea ed lly for Re s calculation tirement .................................... have increased over time. 10 (not including value of primary residence or defined benefit plans) (not including value of primary residence or defined benefit plans) be workers are only p save less than not confident abo ositive reasons. m $2 ore like 50,000 ult y to r paying for fore retireme port th basic ey have nt. expenses (statistically money in an employer unchan -spo ged from 21 nsored retire pe ment rcent plan in 200 wit9 and 20 h a current percen or previous t in By Ruth Helman, Mathew Greenwald and Associates, and Crai Very Well Sg Co omew pel hata W nd a ell nd Jack VanDerhei, Employee Benefit 2003–2009, but is lower than the high of 53 percent recorded Very Co in 2 nfid 00 en 0t (Figur Soe 2 mew 3h ).at Confident 1991 1995 2000Majo20 r R 05 eason2008 M20 inor 09 Reaso 20n 10 research. 1991 1995 2000 2005 2008 2009 2010 Respondent Respondent and/or Spouse workers are the rest of thve eir life, a ry confide nd onl nt ty h 11 percent at the Socia o l Security syste f workers indic m a will te they cont are inue ve to ry likely provid to e be purchase a nefits of a gua t lea rantee st equ da -il va ncom luee to Figure 40, Workers Expecting Retirement Income from Social Security and Defined Benefit Plans ........................ 36 In the 2000 RCS, 31 percent said they needed to accumulate at least $500,000 for retirement. This percentage Although individual worke Gradualrly s rmay be educing s th ign e cu ifirr cantly un ent derestimating how long they will spend in retirement, it appears that 200 employer 8) (Fig (57 ure percent) than 7). to say they have an individual retir Ma ejment or Sou raccount or ce Mino 44 IR r S %oA (in urce cluding a rollover IRA) (46 per- Figure 7, ResearchRetiree Confidence in Having E Institute Ve Ve ry ry So So m m nough Money ee wha wha tt No Nott T To o to o o Pay for Ba N No ot t At At Al Alll sic Expense Don't Don't Know Know // R Rs in Retirem e effuse used d ent .......................... 11 Very Somewhat Not Too Not At All Don't Know / Refused • Bank or credit union (8 Ver Ver perc y y ent of So Som mewhat work ewhaters, 8 No No t Tto perc T ooo ent o NoNo t At ft At Al retirees lAll Don ). Don' 't Kno t Know/ w / RR ef e u fu sed sed Very Somewhat W No ortker Tos Figur o No e 46 28 t At % All Don' 27 t % Know / R17% efused 26% Very Somewhat Not too Not at all Don't know/Refused 2007 2008 2009 2010 rate of benefits, Veso p ry eop So le me wit wh h at Not too N 14 o% t at all D 25 on' %t Know/Refused product the ben or select a efits received guara by retir nteed-income opt ees today, and 2 ion from Gu 3 perc ess a r ent a etirement re somewhat plan wh confident. Ne en they retire vertheless, 37 . Another 35 perc perc ent ento of f wo wo rkers rkers 41% 1991 1995 2000 2005 2008 2009 2010 The savings gradugoals cited by ally increased to workers w 43 percent ho in have 2005 done and 5 a r Wore 4 ker tirement perce s nt in R n ete i 2 re ees d 010 s calcu (Figlation ure 27 have i , page n 25 crease ). d over time. In the Wanting to stay active and invo 2 lv 002 ed 2005 200 60% 6 2007 2008 200 32% 9 2010 92% Figure 41, workers, on Work average, ers Expec have r ting Retire easonable ex ment Inc 2010 pectations a 2002 ome 17%from Savi 200 bout the 5 ngs 2 length of their 006 and Empl 35% 2007 oyment retir 2 52 008 e %ment. .................................................. 20The typica 09 2010l 2008 RCS worker 37 cent). 1991 1995 2000 2005 2008 2009 2010 24% Wor 39% kers Did calculation Did not do calculation 35% 70 % higR her e in tire comes h e Con af vid e their enc e Tha Worke t Me rsdicare 32 W% ill Continue to P 45% rovide Be77 ne %fits Copyright Information: 39% 39% This report is copyrighted by the Employee Benefit Research Institute (EBRI). It may be Figure 8, Retiree Confidence in Having E2nough Money 004 2005 Fig to uPay for M r2008 e 23 edical Expense 2009 2010 s in Retirement ...................... 12 3% 34% 201 Ret0 irees 27% 19% 26% 50% 17% 6531 %%77% 8% are say they are not at all c so om nfident t e 38% what likel hat y to do future Social so (Fi 38% S gure ecurity 4% 6% 49). ben Work 4% efit Figu s ers’ stated will re 3 match or 2 likelihood of o exceed the v 4% btai aning this ty lue of today’s pe benefits, a of product gradual 4% 5% Social Secu 5% 7% 4% rity 5% 64% 5% 64% 2000 RCS, 31 percen5% t said4% they needed7% to accumula4% te at least 8% $500,000 9% for re 7% tirement. 4% This percentage increased to 6% 8% 37% 9% 72% expected to retire at ben age 65 efits cuand s t back p mo enre d 10 20 than %years in retirement. Fifty percent of both men and women who provided • Their employer or form Priv er ate e 78% employer m62 ploy % ers (9 perc Retirees ent o 11% 62f % workers, 1 11% 68 percent o 26% % f retirees). 11% 28% 12% 96% 5% 5% 70% 9% 10%9% 70% 61% of at Least 61% Equal Value to Benefits Received by 7% Retirees Today 6% 88% 89% % 10% 35% 10% 10% Figure 42, Retirees Receiving Retire 35% Workers Hav ment Inc 10% 2009 12% 10% i8% ng ome 17% Trfrom Savi ied to Cal ngs c31 ul 13% and Empl % ate How 60 10% % oyment M 48% 10 1u 2% ch M % .................................................. oney75 % 60% 37 used without permission Less thbu ant citation $1,000 of the source is re 68% quire 11d %. 7% 23% 27 11% % Less than $1,000 31% 14 11% 11% % 10% 13% 11% 46% 20% 27% • One-quarter of work 6% ers (24 9% 9% percent) repor Timing 11 10 of % % tRet they 11 84i % % rehave ment po , 84 A stponed thei % 59% mo 67% ng 14 13 Ret % % ir re plann es ed retir 28%e 16% ment a 86% ge in the past year 11 14% 19 %% D En o y jo oy ur ing ow 7% w 12 no e % rk sing tim 58a % te 18% 16%Figur 16% 11% e 7 12% 17 15 % % increase decreases ov sharp er the past ly as ag 13% tho 12% se with ei e ris ght years e lower s. It in from 30 percent also decreases as assets increase. comes 66% 22% 200not 9 11% at NA all 8% c 66% onf17% ident in 20 66% 02 (Figur 16 72% e 43 % ). Figure 9, Retiree Confidence in Having E 7% nough Money to Pa 13% y for Long-term Care Expens 9% 13% 11% 16% 17 16% % es in Retirement ......... 12 The 2010 Retirement Confidence Survey: Whil 43 perc e ma ent in 200 ny policymakers c 5 a 15% nd agai on nsider to 54it to perc 17 be desirabl en %t in 20 33% 72% 10 e to (Fig 71 22% % lim ure 26 it acc ). ess to the money co 23% 21% ntribut 17% 15% ed to retirement 18% savings 12% 16% 70% 18% 22% this information expected to Wolive u rkers ntil 81% at le 1169% %ast age 81% 24% 80% 85, an 80d %25 perc 26% ent expected to liv 12 e% until22 at least age 90 % (both men 26% 28% 34% 10% 79% 34% 349% % 17% 79% 69% 63% 15 80% % 12% 80% 10% 68% 69% 10% 63% 27% 79% 28% 11% 78% 30% They Need to Save for a C30 om %fortab 32l% e Retire 51% ment 3177% % 31% 39% 35% 36% 14% 13% 61% Retire 10% e Confi 40% dence 77%in Hav 27%ing 12% Enoug 12% h Money 50 66 % % to 77% 75% 75% Figure 43, (FigWo ure 2 rker 8, pa Confid 19% ge 27 en ). ce That So Amon 31% g the re cial Security Will as 18 ons % Worke cited rs for Continu del 32% aying retirem 17% e to Provide Bene ent 32 10 10% % are % 32% the fits of at Least Equal poor economy (29 percent of 19% NA 200238% 22% 4 38% 61% 16% 13% 15% plans so t Recommended C • The hat company plan money itation managin 30% 18% la : Ruth H sts as long g14% t 18 h% e ei lman, r emp as possible Craig loyer-sp Cope and is onsored r land 31 not , an %edepleted d Jack tire 31 ment % Vabefor plan nDerh ( e7 ret e i, perce “T irem he ne t of 201 nt, only wor 0 R 18ek % a mi tirem ers, 5 nority of work ent Conf percent of idence ers 14% 15% 19%30% 16% 18% 19 72% % 16% Introduction and women). Ten percent each thought they will live 12 u %ntil a 18 ge % 95. A 27% ccording to 18% the 2009 37 OAS % DI Trustees Report, a Figure 10, Retiree Confidenc 16 11% % e in Having Employ 17me % 14 Done a Good J nt % 16%Worker 6% 26% s ob of Preparing Financially for Retirement ....................... 13 56% Raising the age Ve 15 at r% ywhic So 20 h % mewhat Not Too Not At All Don't Know/Refuse 70 d% 69% 10% 6% 18% 69 17 %% 23% 12% 17 15 Confidence Stabilizing, But Preparations Continue to Erode $1,000 Wa –nt $9, ing 99 mo 9 ney to buy extr 45a % sRetirees 36% 421% 3% 1751% % 72% $1,000–$9 15% ,999 Pay for 50%Basic E 52% xpenses 13% in Retirem 33% ent 11 68% % 19 16 21% 22 17% % 16% 22% 11% 17% Value to Benefits Received by Retire 24% 30es Today % 12% 24% .................................................................................. 17% ......... 38 those postponing retirem A e 27 snt k a f % ), a in chan ancial ge in adviso their r employme17% nt situation (22 percent), i16 nade % quate finances (16 per- 24% 19% 18% 26 24% % th retirees). people can begin receiving full 26% 21% favor cha Survey: Con nges fidence in the Stabi way lizi win thdraw g15 , B % ut Pr als are epara allowe tions Contin d from t ue h to Erode,” ese accounts to h EBRI Issue elp ensur Brief, e li no. fetime 340, inco Marc mh 2 e. 010. Thirty -eight 23% 5% 22% 45%18% 17% 68% 65-year-old man today can expect to live 2000 until ag 201 e 8 0 28 2, %while a 65-year-old woma 40% n today can 68% 24 e %xpect to live until age The 20 wave of the Retir 22% ement Confidence Survey (RCS) finds that Americans’ confidence in their 21 abil % ity to afford a 22% 37% 62% 12% 22% 8% 29% 22% Retirees Fi Fig gu u14 r re e% 49 43 23% 31% 31% Figure 11, Workers Having 49 Saved Money % for Retirement Fi .......................................................................................... 14 gure 26 22% 25% 25% 24% By Ruth Helman, Math retirement ew G b reenwald enef 44 its %by oand 21 ne % y Associates, and ear Craig Copeland and Jack VanDerhei, 59% 59% Employee Benefit Ban 28% ks 26% 5% 4% 4% cent), and th21% 35% e 6% need to make up for losses i 46% n the stock market (12 26% perc42 ent). 5% % 21% 24% 5 43% 7% 7% Workers 43% 32% 75% Figure 44, Retiree Confidence That So Earlier thcia an P l Security Will lanne 26% d About Continu w 47% 9% hen Pla e nne to Prov d La ide Bene ter than Plfits of at Least Equal anned percent of workers say they 10 Emplo % favor re yer-squiri ponsn og re in d dividuals to use 25 $10 %0,00047% or half of their plan mone 56% y, whichever is less, 26% 38% 20%63% 84. 35% A job op 41 po % rtunity 28% EBRI Employee Ben 28 efit % Research Institute Issue Brief (ISSN8% 0887 -127% 37X) is publishe10 d mont % hl 41% 51% y by the Employee78 B% enefit Research Institute, comfortable retirement, $10,000 whi –$2 ch ha 4, W 999 od rkdrop er Cpe on df s id he arply n200 ce over t T 945% hat S he oc past two i12 al 42% Secu yrity 13 35% ears, has stabi 46% Will C 9on 45 tin % lize u 1e d 6 now t1 h4 at the economic 19% Likel 26% iho19% od of 19 Pur % chasing a Guar9% anteed-Income 36% Pr 27% oduc13 t % Report availability: $10,000 This r –$ A 24, e m port, a oun 999 t lo ong w f Sav R ith six i espo ngs W ndent relat o 34% rker ed R 201 s e spo Th 0 R ndent in 14 C k 40% S T and/ Fact hey 42% or S 13 She Need po eu ts, is ava se 38% fo 13 r Retilable ire13 me on nt the , 11 Internet at 9% 13% 26% Overconfidence? Re ad or hear that is how 42% much n16 eed % Reti edrees 20 11 % % 41%24%32% 44 41% % 41% Research Institute retirement 7% savings plan 35% 13% 46% Figure 12, 1100 Value to Benefits Receiv 13Reti th St.rees Having Saved NW, Suite 878, 25% Washi 40% ngt ed by Retire Money on, DC, 2 17% for Re 0005-es Today 4051, tirement..................................................................................... at $300 .................................................................................. per ye24% ar or is inclu 33% ded as part of a m 20% embership subscription. Perio ......... 39 di- ..... 14 32% 38% 30 17% % 37 13% % 38% 31% 27% 9% 39% 17% 49% to purchase a product 17% at retirement t 41% hat will pay guarant 37% eed income 36% each month 37% for life. Fewer, 32 perc 24% ent, favor 40% Very Som 38% ewhat 31 No% t Too Not At All Don't Know / R34 efu % sed to Provide Benefits of at Least Equal Value volatility of the recession has abate 42% od r . Sel Th ee c steep declin ting a Guare asn in oth teed-e Inco r retir me e Op ment co tion nfi frd om ence indicators 41% also appear to be 16%Among 38% Those 37% Doing a Retirement Savings Needs Calculation A decrease in the value of your 43% 34% www.ebr cal • s Although po i.org stage Th ra the te e RC paiage d iS n W Fact at which ash Sheets cover ington 47 , D workers repor %C, and asuch topics dd 36% itional t they mailin as chan expect g offices.t P gin oO retire shows S gT expectations a MASTER: S little chan end ad b dr ou est retirem s ge from 2009, changes e to: nt, a EBRI Iss ge, a a lo ue Br nnger d ge ief,-term nde 1100 r , and 38% 55% 45% 47% 33 35% 42% 20 51% % % 74% 47% 35% 43% 46% 26% 32% 44% 44 37% % 62% 37% 55% 34% 2010 14W %or36 ker %s 17% 32% 23% 46 17 %% 34% 41% Although many workers may 32% have re-evaluated their confidenc 7% e i40% n having a comforta 20% ble retirement in the wake of the Raising the payroll tax paid 68% 1 35% requiring workers to take their money in a series of with 67% 45% drawals at 28% retirement r 39%ather th67 an %withdrawing all of the money Figure 45, RCS Methodol Worker Confid ogy en an ce That Me Empl 33% oy to 41 er di B % -care Will Con S epon ne 31 fits % Worke sor R ed re sc Re etiinue to vte ir d e me byProvide Benefits of nt Re Pl tire 19% an e,s A T m oong day W at Least Equ orkers 42 a% l Value to Figure 13, 13th St. N Workers Currentl W, Suite 8 52% 7Othe 8, Wa rsh per sav in y Saving gto sona ing n, D s 52% l or sC a,v inv 20 iMoney for Re ngs 65% 00 est 5-4 amen nd 0572 1 ts . Copy26 rig tirement ................................................................................. % h0 t 2052 10 15% % by E14 mployee52% B10 enefit Rese9arch Inst1 itut3e. All right11s reserved. No. 340. .... 15 $25,000–$49,999 24% 44 26% % 13% 47% slowing. However, th 18% e retirement 23% preparations reported 28% by some workers are eroding, leaving them less prepared for $25,000–$49,999 13 13 14% 12 16% 10 1251% 11 12 are available online at www.ebri.org/surveys/rcs/2010/ 37% 43% look finds significant 58% chan Use a ge. n In o nli part ne caicular, lcu lat201 or the perc 0 13%entage of workers 50% 42% 27% 43 who % 55% expect to 26 retire aft % er age 65 has 57 6% % 26% 16% 39% 26% by workers 5% from 6.2% to 7.2% 5% 41% 6% Retirees 21% 29% 22% 50% 25% 9% 749% % 9% investments 8% 7% 36% 8% recession an d the accompanying th economic turmoil, m 24% 26% a<. ny 5% wo 8%rkers still provide co 11% nflicting resp 15%onses with respect to Benefits Received by 48% 35% Retirees EXEC 48% 7% TodayUTIV ........................................................................................... 48% E SUMMAR 31% Y 32% 43% 38% .............. 39 at one time. Only about on 11e-quarter % each favor 47% chan Retirees gi35% ng employer 17% -s28 ponsored retir % 18% 12% ement savin 26% 41% g11 s10 23% pla % % ns so that 22% 22% 2009 13% 17% 30% 12 30 % % 34% 14% 47% These findings are part of the 5% Insu 20 ran annual Retirement Confidence Surve ce companies y (RCS), 10% a survey t 36h % at gauges the views and attitudes retirement. 36% 34% 9% 11% Needing money to ma 29% ke ends meet 17% 42% 59% 39% Figure 14, increase Total Saving d over time, s an 10% d Investment from 9% 11 percent s Rep in 8% 19 orted by 91 to 1 Worker 4 percent in s, Am 11% 1ong Th 995, 9% 1 9%9os perc e Providing a Respons ent in 2000, 24 pe 9% rcent e ................. in 2005, 16 33% 33% 45% 31% 53% 2009 10% 11% 7% 56% 66% 32% Retirees 7% 5% 8% 30% 11% 32% confidence and retirement preparation. 9% This suggests t 11%hat at least some workers may be overcon 12% fident about their Very 8%Somewhat8% Not Too Not At All Don't 9% know/Refused workers could not wit43% hdraw any money at all until they reach age 66 or leave their job, whichever comes sooner 11% 14 20007200 8% 514%201081 7%20091269 2010 18% 276% $539 0,% 000–$9 42% 9,999 Workers 42% of working-age and retired A Figure 46, Retiree Confiden m cericans regar e That Me 40% di 7% dcare Will Con ing retirement, their tinue to 26%preparations for retirem Provide Benefits of th 42% 40% 6% at Least Equ ent, their confidence with regard to 67% 6% al Value to 8% $50 In 38% ,000 dividu –$ 3 a99, 8 l r % etir 99 e9 ment account15 38% 11 11% 12 13 12 12 41% 11 Fill out a worksh 37% eet or form 2002 6% 23% 36% 6% 35% 21% 35%43% 43% 20TH ANNUAL and 33 The 20 10 p RCS ercen Reti : The 2 rement t in 20 010 1Confi 0 R (Fig etireme dure 29, pa ence nt Survey Confidence ge 28). was underwritt Survey—the 40 en by % 20 more t annuhal 7% anwave 30 or 34 40% of this surv gani %7% zations, listed on ey—finds th pg. at th 4.e 33% 42% 41% 42% 36% 39% 39% 0% 42% Al39% 41 41% l w% orke rs47% 6% Figure 15, Total Savings K an eepin d Investments Rep g health insurance 40 or % o Reti rted by rees 39% Retirees, Am 38% 40% ong Th 40% 36%ose 5% Providing a Respons 29% e .................. 17 likely f Findings in inanc thi ial ssecurity in year’s RC reti S include: rement. A general public opinion survey 38% such as the RCS cannot pro46 vide a % definitive The Em 37 35% or IR %plo Ayee Benefi 37% t Research Institut 13% 35% 27% e (EB 40RI) was founded in 1978. Its % 44% mission is to (28 percent), could not take a loan agains 44% 32 t the mo % 35% ney 15% in the pla 36% 25% n (25 percent), 40% and could 36% 5% 25% not mak 5% 4% 5% 5% e a hardship Benefits Received by Retirees 34% Today 35% ........................................................................................... 34% 37% .............. 40 various aspects of retirement, and related iss 32% ues. The survey was conducted in January 27% 2010 through 20-minute telephone 3% 32% 3% 3% 32 30% % 32 28% % 27% 27%37% 43% 30% 30% 36% 26 25% % 43% 24% 3%25% 24 4% % 4% 28% 4% Reducing the current rate of 23% Workers 8% 42%15% 42% 25% 29% 48% 2% 26% othe22 r be % 35% nefits 42% 26% record-low confidence 27% leve21% ls measured during the past 21% two years of economic decline appear to have bottomed out. 26% 2% 2% 21% Did c alcula t ion 18% 18% 25% 16% contribute to 2000 , to encourag 25% e, an 18%17 d to enhanc % 23% 19% e the developmen 17% 48% t of sound empl 23% oyee benefit answer to • The wh per ether centaworkers NA ge of NA workers NA are prepa 40 15% very % rin conf g adequately ident about havin for 8% 16% retirem g enough 30% ent, 15% but the mon 38% e RCS y 17 for a % do NA comfor es provi table retirem NA de so16% me strong in ent remai dications. ns 14% 2010 42% 20% 19% withdrawal (21 percent $112 00, %00 ) (Fi 0–g$ure 22). 249,999 13% 19 38% 44 1 % 1 13 20 35% 13 13 14 %% 1013% 15 Figure 16, Worker Confid ben 13% efits en by ce That 5% fo 36% r all Retirement Saving new s are Invested Wisely, Among Tho 13s %e Having Saved 12% 41% 31% 1% 1% 10% 1 11 0% % interviews with • Americans con 1,153 individu $100, tinue 000– to lack $249 als (902 workers and 251 reti Advic,e 999 c ofo f nfidence am 49 ily % or 15 f in rien id ns stitutions. 12 rees) ag Th 11 e 25 a ey aren most l d older in the 40 15 % ikely to 15 United States. Random digit dialing expres 12s confi 1d 1ence in private 36% NA NA NA 0%0% Figure 47, Who we are Favor/Oppose Changes to Social Security Workers ....................................................................................... 44% ........ 41 Employ 1994 Th er-sp 199 e 44% fed o 5ns er o 200 a rl ed go 0 traditiona ve 2r0 n 0m 1 en2 lt 38 00% 2 2003 2004 27% 2005 42% 200 50 6 29 %%2007 56 20% 08 2009 2010 The percentage of workers 24% very conf programs and so ident about und public policy having enough mon through objective ey for a comfor resear table ch and retirem educati eon. EBR nt has stabiliz I is the only ed at Retirees 4% 25% Did not do c alc 39% ula t ion 10% 3%32% 22% recipients 6% 37 28 % % 34% 50% 40% Try20 ing 02 a different ca20 re 30 er 05 % 2008 2009 2010 steady at 16 percent, whic 33 h is % statistically equival 31% ent to the 20-year low of 13 percent measured in 2009 (Figure for Retirement ................................................................................................................ 32% 32% 45% 45% .............................. 17 Employer-sponsored retirement Reti 200 O rt ees 9 her p 11 ersonal sa % vin 35 gs % and 45% 34% 56% Employment pension or cash balance plan 2932 %% 20% 34% 52% was used to obtain a representative cross section of the U.S. 1993 1995 2000 2001 2002 2003 population. To further increa 2004 2005 2006 2007 2008 44se representa % 2009 39% 2010 37tion, a cell phone % employers (23 perc M 20 u 01 ch 38 ent o hig %h 2er 0 f0 wo 2privat rkers and A 20 li e, nonprof 03 ttle hig 2 20 h7 er i04 tp , nonpar ercent A2 b0 out of r 05 tisan th, e e Washington, DC-b tir same 20 ees 06 very 20 A co li 07 ttnfi le lo d ased organi w ent 20 e08 r) and leas 20 zat M09 uic on com h t likely to low 20 e10 rmitted exclusivel feel confidence y to in Very confident Somewhat confident Not too confident N 37 ot % at all confid 42% ent 1 1993 998 12 995 000 20 Soci 200 00al 1 Sec 2001 2 u002 rity 2002 20032002004 3 2004 2005 2005 Empl 200 oyer 20 6 06 -sponso 200 200 7r7 ed t 2r008 2 adi 00t8 iona 200 200 l pensi 99 o2010 2010 n 16 percent, which is 1 statistically e 1998 9 B 9e 2fore1 60 99 2000 5 20q 2001 0uival 0 60-64 2ent 00 2002 1 to the 2002003 2 20 26 -y 00 5ea 2004 3 r low 2004 2005 of 1 266-69 00 35 perce 2006 200n 62007 t measu 70 or 2007 older 2008 red 200 i 8n2009 20 2N 00 09 ev 9er ( 2010 F r2 39 e ig 01 tir . 1 % 0 e , pg. 7). Retiree First, workers who are very sa confident t vings plan hat 200 they w 9 ill invhave estme nt enough mon s (including IRA) ey to live 2010 comfortably throughout their retirement Figure 48, Favor/Oppose Changes to Medicare ........................................................................................................ 41 1993 Befor 1995 e 60 2000 200 60-6 1 42002 2003 2004 65 2005 200666-2007 69 2008 70 2009 or olde 20r10 1, page 7). R 199 28 e% 3 tiree 199 conf 5 ide 2000 nce a 20 b01 out hav 2002ing 2003 a financ 2004 ially secure 2005 200 retire 6 ment has 2007 2008 also stabili 2009 201 zed, 0 with 19 percent $2 19 50, 9300199 0 or 5 mor 200 e0 2001 15 2002 2019 03 2004 212005 1 20 406 2012 07 2008122009 12 2010 public policy research and education on economic security and employee benefit issues. $250,000 or more 7 11 12 14or cash bal 12ance plan 12 11 supplement wa the federal Retis added to the ree Confide government ncsample. Star e That (11 percent of wo Retirement Saving ting with the 20 rkers and 8 per 01 wave of the s are Inve cent of reti sted RCS, all Wisely, Among Tho rees). Just data are weighted by age, sex, and 19 percent o se Having Saved f workers and Figure 17, 28% 26% confidence about having a financially secure retirement has also stabilized, with 19 percent saying now they are very years appear to be better prepared, on average, than th Fose who igure 22 are somewhat confident. In turn, those who are Table of Contents Workers Retirees SoS ur our ce:c e E : m E p m l oy ploy eeee BeB ne enef fEBRI’s member it R it eRes seaearc rch Ih n sIn tits u ttit e utship includes a an e and d M M ath ae thew G w Gree reenwal n w cross-section of ald d & A &s A ss os co iacti e as tes , In , c pension funds; businesses; trade associations In .,c 20 ., 1993–2 1 0 Retir 010 eme Ret nt C irem onfent id enc e ; saying now t S Sou ourc hey are rce e:: Em Empl pl very o oy ye ee e B B co 51% e enef nenfident fiit t Re Res se ear arc c(statist h h Ins Insttiittu ut te e ically e an and d Ma Matthew hq ew uival Gr Green eee nw wal n at to th ld d & & A As ss so o e c ciia at 20 tes es percent ,, IInc nc..,, 201 2002 0 Ret –2 measur 01 irem 0 Re ent tire Co ed me nf nt in id C enc o 20 ne fid 09 enc ) e(Figure 2, page S So our urce ce: : E Em mp pl loyee oyee B Be enef nefiitt Re Res sear earc ch h I In ns sti tittut ute e an and M 25% d Ma a 25% t th hew ew Greenwal Greenwald d & & Ass Asso oc ci iat ates, es, IIn nc c., ., 2000–2010 R 1991–2010 Reti etirre em me ent nt Confidence Figure 49, Likelihood of Purc S Sour ourc ce e:: E Em mpl pl 24% oy oyhasing ee ee B Benef enefiitt a Guar R Re es sear earc ch hanteed I In ns sttiittut ute and M e and M -Inco a atthew Greenw hew Greenw me Product al ald d & & A Ao s ss sro o Selecting a c ciiat ates es,, IIn nc c..,, 2007–2010 1998–2010 Guarante Ret Retiirem rement ent ed-I Conf Conf ncome iidenc dence e for Retirement .............................................................................................................................................. 18 education to reflect the actual proporti S S So o ou u ur r rc c ce e e:: : E E Em m mpl p pllo o oy y ye e ee e e B B Benefi e en ne effiitt t R R ons in the adult popul Res e es se e ea a ar r rc c ch h h Ins IIn ns stttiiitt tu u ute and tte e and and Ma Ma Mathew tth hew ew ation. Data for wa Gree Gree Greenw nw nwal al ald d d & & & A A As s ss s so o oc c ciiiates at ates es ves of the ,, , Inc IIn nc c., ..,, 1 199 199 994– 1– 8–201 201 2010 RCS conducted before 2001 h 0 0 R Re Re ett tiiirem rem reme e ent nt nt Confidence ave 22 percent o S S S So o o ourc f u u u rr rc retirees r c ce: e e e::: E E E Em m m mpl pl pl ploy oy o oyee yee ee ee e port B B B Be e e e 22 ne ne n nef e % fffi they a iiitttt Re Resea Res Res sear e earc ar rc c ch r h h he I I In In n nve s s s sttttiiit itttr ut ut ut ute y e a e an e confident and an nd d M d Mat M Ma a attthew h h he e ew Greenwa w w G Gr Gre abo ree eenw en nw w u a a al t ba llld d d d & & & & A A As A nks, wh s s ss s soci so o oc c ciiia at at atte e e es s s s,,,,il IInc., IIn n n e 12 c c c...,,, 1 199 1991 19 991 93 2–2010 percent o –2 –2 –201 01 010 0 0 Ret Ret R Reti etiire ire re rf e me m work m me e ent nt n nt t ers and 13 percent of Su Sour So Conf rve urc c y.e e id : : enc Em Em e S p plloy o uyrv e ee e ey B B se .enefit nefit R Re es se ear arc ch h I In ns sttitute itute a an nd M d Ma athew thew G Gre reenw enwal ald d & & A As ss so oc ciiates ates,, I In nc c.., , 2 2009 010–20 Ret10 irem Re ent tir eCo me nf nitd ence 23% 20% Source: Su Sur Sourc rv vey ey e . E s:. E mm plpl oye oy Fav e e e B e Bo n ene er/ fit Re fO it Re p search p searc ose C h Inst Ins ittute and h itut an e and ges t 19 M Ma % athew tho ew Gr W Geen ri etenw hdraw waal ldd && A A sal s ss os o ci cates iPermi ates , Inc , Inc ., .,t 1 20 t 993–2010 e10 d Re From tirem Re etint rem Con ent fidence confident (statistically e S S So o our C Su u u o r rr nf c c c ve e e e id :: : y e E s. E E q nm m m cuiva e p pl ployee S loy oy urv ee ee lent to ey B B B se e ene . nef nelabor un ffit ii the tt Res R Re es se ear e 2 a ar r0 ions; h c c ch h h perce In IIn ns s s18 tt titut iittut ut e % alth e e e an nt meas and and M car d M Ma a ae prov tt th hew hew ew Gre ured G Gree iders and insur reen in en nw w wa 20 a alld & ld d & 09 & A A A) s s ss s s(Fi o o oc c ce iiiat a at g rs; tes es es . 20% , I ,2, government org , I In n nc c cpg. ...,,, 1993–2 20 20 8 10 01–2 ) Ret . 010 010 irem R Ra e e enizations; n tti ir tre eCon m ment ent fid C C en onf oc nand service firms. e fidenc i dence e somewhat confident a S So our Su Su urr rc c v ve e e e::p y y s. s. E E pear m mploye ployto be better ee e B Be ene neffiitt R Res ese ear arpr c ch h epared overall IIn ns sttiittu ut te e a and nd M Ma atth hew Gre ew than 16 Gr% een enwal th waose ld d & & A Aw s ss sh o oc co are iiat ates es,, II not co n nc c..,, 20 200 02– 9–2 n 20 f 010 ide 10 Re R net. ttiirre e For m ment ent ex Conf Conample, fiid den enc ce e confidence Sour Conf ce: iden Em cepl So uy rv eey e Ben s. efit R 21% es14 ear% ch Institute an 21% d Mathew Greenwald & Associates, In 15% c., 1993–2010 Retirement Introduction .................................................................................................................. Su Corve nfidys. ence Surveys. 39% .............................................. 5 8). Co Confi Con Conf nffiiiden denc d denc enc ce e e S e S S Sur u u urv rv rv vey ey e eys. ys s s.. . 12% Option from a Sour Co Su Sourc n r10 c v fe ie d: y % e e . n E :n c m E e Employer- m pl Su o ply rv oy ee e ee y B s.B enefi enef t Resear iS t Res pons ear cc hored h Insti Insttitu ut Re te e an and M ti d M rement Plan a ath thew ew G Gr reenw eenwal a , ld d Among W & & As Ass soci ociat ates, Inc., es, o Inrk c.,ers 2004–2010 200 .............................................. 2–2010 Ret Reti irere ment ment Confidence 42 37% 9% Confi Surv denc ey. e Surveys. 8% S Su Su urv r rv vey e ey y.s s.. 6% 7% been weighted retirees say t to allow fo Su Surv rvh e ey y ey are s s. . r consistent co very confident mpariso about ns; co insurance nsequent com ly, some data in the 201 panies (Figure 19, pa 0 RCS ma ge 19). Moreove y differ slightly with data r, the Confi 44 de % nce Surveys. Figure 18, Attitude About Stocks as 32% Em 32% plo 19% yer-S a Sound Inve ponsored 32% Re stment ................................................................................... tirement Savings Plans, Among Workers ....... 19 31% Co Su nfird ve en ys. ce Surveys. 33% 38% 35 49% %   increases as t he reported total of sa 48%vings and investments increases. Further, th 48%e likelihood of having done a 18% 33% 17% 44% 39% 43% 44% 33% 44% 34% Retirement Confidence ......................................................................................................... 41% ..................................... 6 40% 28% 16% 33% 38% 7% published in previous waves of the RCS. Dat 16% 7% a presented in tabl es in this report may not tota 16% l to 100 due to rounding and/or Workerperce confintages dence about of retir pa ees ying for basic expenses somewhat15% confident abo in re ut tibank rement s (4 has r 5 perce eboun nt, dow ded sli n g from 34 htly, wit % 51 percent h 29 percent in 2009), i now sa nsuranc ying e 1992 1995 2000 6% 2001 2002 2003 20 06% 4 2005 2006 2007 34% 2008 34% 2009 2010 EBRI’s work advances knowledge and understanding of employee benefits and their 33% 14% 5% 5% 5% retireme • Worker nt sav ings n confide ence about eds cal 42% culation paying for basic expenses increases with 5% confidenc in e re , an tirement d r 5%etirement has reboun savin de gs goals d slightly, wit tend to rise h 29 percent with now Figure 19, Worker Confidence in Institutions ............................................................................................. 5% 4% ................ 19 4% 13% 3%11% 13% 13% Overall Retirement Confidence ............................................................................................................................. 6 13% importance to the nation’s econo my among policymakers, the news media, and the public. It missing categories. Retireecompanies confidence (42 percent, about having a down financi from ally secure 56 percent 12% retir ), an eme d th nt a e federal lso appears to 12% gov12% ernment have 12% (30 percent, stabilized. Nin down eteen from 45 per- percent now The they are spenvery ding confident level that abo woru kt havin ers antici g eno pate u in r gh money to etirement pay for is relate basi d to c h expenses duri ousehold inco 11% ng me. retirem Those ent (up with less tha from 25n percent $35,000 in 11% Finally, the retirement savings calculation appears to be a partic ularly effective tool for changing retirement planning confidence. saying th ey are very confident about having enough mone y to 11% pay for basic expenses during 11 re % tirement (up 10% Strongly Favor Somewhat Favor Somewhat Oppose Strongly Oppose Don't Know/Refused The retirement age reported by retirees ha does this b s changed even mo y conducting and pre slowly. ublishing policy re In 1991, 19 search, analysis, percent of reti and special reports on rees said they Retirees Figure 20, who Retiree Confidenc work for pay in retir e in Ins ement titutions most often sa ............................................................................................ y they did so because they wanted to stay active an................. 20 d involved Confidence in Other Financial Aspects of Retirement .......................................................................................... 8 What we do One reason that confidence in their investments may ha Figure 40 ve increased among retirees is that many have recovered say they are 2009, but cent) are stilve l down r decli y conf from ning (Fi ide n34 t about g perc ure 2 ent in 20 havin 0, pag ge enough mon 08) (Fi 20). g. 3, pg ey to live . 9). comfortably throughout their retirement years in house hold income are more likely than higher-income worker s to think their spending in retirement will exceed their 1993 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 7% Expecte behavior. d sour Fortces y-four of income percen in t of reti workers rementwho calcu among worker lated a go s and al amount actual sources of retir in the 2008 ReC ment S repo income among retir rt having made chan ees have ges to In theory, the Among th from 2 e re5 asons given weighted sample of 1,153 yields a statistical pr percent in fo 2009, r the chan but still ge by work down froers m 34 postponin p Feigure 25 rcent ecision of plus or minus 3 p i g r n 2 etire 008 ment in ) (Figur th e 3, e 2 pa 010 ege rcentage points (with 95 percent RCS 9). are: The per centage of retirees emplo 26 yee benef % its issues; holding educational br 28% iefings for EBRI members, congressional and Figure 36 retired at These findage ings65 or are simi later. 1991lar to 1996 This percenta some other 2000 200 ge has estimates of Am 1 200fluct 2 2u 26 0at 0 % 3Figur ed er 2ove 0 ican 0e 31 4r time househ 2005 an2006 d old assets. Q now200 stands 7 200 at 3 uantifi 8 2200 perc abl 4% 9eent dat 201 ( a 0F from t igure 30 he 2007 ). The (92 Con perce fidenc nt) o e in Other Fin r enjoyed wor 1993 199 ak ncial Aspe ing 5 2000 (86 perc 2001 cts of Re ent), 2002 but t tirem h 2003 e pe Fi egur rcentage nt 2004 e 48 2005 23who % 2006 27 report % 2007 workin 2008 g solely 226 009 for % no 2010 n-financial reasons Source: Employee Benefit Research Ins25 titu % te and MatF he igur w Green e 42 wald & Associates, In24 c.,% 1992–2010 Retirement Retirees Receiving Retirement Income From 23% Preparing for Retirement ...................................................................................................... 21% ................................... 13 (statistically equivalent to confidence in the valu 27% e of the 20 equities perc as a enlo t ng-t meas erm i uredn in vestment. 2Fi 009 Fi gur gu ). re e At th 45 4 Forty-s e sa ix percent me time, 39 of rpercent ar etirees (up e no from t confident 30 percent ab iout n 2009 pre-r Figure 21, Three i etirem n 10 Rep e Ame nt spen orted Offer a ricadin n Ws ag og rker . e Co s 2 nd Take Up o h5 nversely, thos a an d tod o use ve $10 r re 0,0 p fe w Employer-S 0 o0 r to th ith r he a high y lf haeve r pon i n not come ar so saved red Retireme e mo any money re apt nt Savings Plan to t for hink retirement 21 they % will s, Among Employe (29 perc be ableent o to refduce workers t d heir At the same time, workers who are most confident about their financial security in retirement also tend to expect to get federal agency staff, and th Figur e news e 19 media; and sponsoring public opinion surveys on employee their retirement planning as a result. Mos Amount of t often, Sa these vings W work orkers T ers say they started saving hink They Need or investing more (59 percent). changed slight indicatin ly over tim g they Conf T id are re end i ncee S ve . u n rv Although ry ey Post con s. f-Ret ident virtu ir about em ally all en pa t v retir ying s. Pre efor es- Ret continu basic irem expenses ha e to ent r Spen eport r din se stayed lev ceivi g, A nm g in ong come el at Ret 33 from ir percent ees Social (s Sec tatistically urity, the certainty) of what the results Workers expecting benefits from would be if all Americans age a defined benefit plan are 25 and older were surveyed w more apt than those not expectin ith complete ac g such bene curacy. There fits to think are Comparison of Expected (Workers) and Actual (Retirees) Retirement Age Survey of Consumer Financ 16 e% s (conducteFav d by the or/O U.S. ppose Ch Federal ange Reserv s toe M Board) fo edicareund that the median (midpoint) level of median (midpoint) age at which retirees r Reteiport t rees Rece hey rei12% ti vred ing has rema Ret 26 ir% emie nnt ed at or In23% com ve e ry near33% age 62 througho 7% ut this time. is small. • Over time, Ninety perc the RCS Sourc ent i e:of E t m d h has o pl e eir oy n p tify at eel a Bn b enef served c m least o o it Res ne Social y,e a wh rc h n hange ic e I n he Secu s financ tiv tut e s i e r and is n riial r workers’ expected sources t M y a an Figure 6 e thew G as d on for D reenwald efined Benefi havin & Assg o wo ciatesrked, t Pl , Inc.of retir an , 199 suc s 1–2010 h as ement Ret wantin irem in ent come. g to buy In extras particular: (72 per- PREPARATIONS STILL ERODING: Fewer workers repo Figur rt tFigure 9 ha e 12 t they and/or their spouse have saved for retirement The 2010 Work RCSers ....................................................................................................................... finds that the sharp dec W W oo rker rker lineC s in con Con onffid ide e fidenc n nc ce e T in Ha eh of at the M vie n past t d gi c Ea nou re w o years W gh ill C Mo o ney abou ntin tu t other oe financi ................................ 20 al aspects of and statistical Saving for Re ly equ tirement ivalent ............................................................................................................................... to the 43 percent observed benefit issues. EBRI’s Ed in 20 ucation and Re 02) indicatese that arch the Fund statem (EBRI-ERF) performs ent “Over the lothe char ng run— ........... 13 itable 10 to , having enough money (statistically equivalent to the 32 Fi perc gure e 16 nt observed in 2009 and 34 percent in 2008). Like worker spendi the most out and r •e tirees). ng in The poor re of retir Of t tirement. economy (29 hese, ement, 79 percent of wor so that the percent). ir a fo W r ccumulate k R o ers and 60 rk etier C remo d sa en nfide tpercen , vings w by n ce Htous of r iill n Ins nee ehold etirtitutio d e to stretc es say this Inco ns mh e fu is rther. because Work they er s who a cannot or re coul veryd not Preparing for Retirement 2 perce Other actio ntage equival n of s ent reported i workers e S Conf o to urcte ih denc : e 34 perc En m x e S clu pe plouyc d rv ete: e ey ing B s .e ent observed nincome efit Resear fr chom this sourc Ins in titut 2 e 009 and Mat ) (Fig he ew ha Gre ure 7 s en decl w,al pa dine &ge 11 Ad ss from oci). ates , 88 Inc p ., 19 erc 93–20 ent 1 10 R 9e9 ti1 rem to ent 7 7 percent in 2010, other possible sources of error in all surveys, Source: Employee Benefit Res8% earc however, that ma h Institute and Mathew Gy be more s reenwald & 8% Assoe crious than the iates, Inc., 1993–20o 10 reti Recal calcula tirement Confid tions of sampli ence ng they will also have retiree h less ealth cov , to7% pure ch rage throu ase an a6% nng uih ty an 7% Figur employ 7e % 21 er. Others w 6% ho mor 7% e often say t 6% hey wi 7% ll receive this type From Savings and Employment 5% household assets of all Americans w Wh oo hav rker e C an onfi asset is dence$ i221, n Do 50 in 0. g a This Goo inclu d Job des t ofh e value of the primary home, which cent), a decrease in the 3% valu 3%e of their Retir savi P ea es Hav yngs or for Me ing invest dica Sav lm E een d xpe M ts (62 per o ns ney es ifn oc R rent), Ret etir needing money ie rme ement nt to make ends meet (59 per- (69 percent, down fewer workers from are 75 expecti percent in 2009 but statistic ng to rec educa Rto eti P r tiona ee ro ev ive reti C l, and id onfidence in e B scientif rement enefits ally ic func incom o e fHav a qti uival tons of the Instit e L in from eg ent a E st to 7 nou Social Equ 2 gh a perc Security (77 percent, down from l V ute. EBRI Money aent lue in -ERF to 2008 is a tax-ex ) (Fig. 11, empt organizatio page 1488 ). per- n retirement are slowin Conf Surv iden g or ey W Ver c se .o S ev yr u Li k rve en rev kel eyrs Conf y . ersing. S id om enc ewhat Most notably, e T Li h kel aty RetN ire ot29 T m oo Li e perc nt kel Sav ent o y ings A f N workers are n ot At A re ll Li In ke vle yst oed w very D W on't is confident that Know ely, they will confidence, 20 y Retirement ears—you be retiree co Savings ............................................................................................................ lievenfi that s dence in tocks in gener having enaough l will money be a ver has vari y good inves ed ove tm r the ent” 20 des years cribe of t s them he RCS, very ................................. 15 or but it r somewhat emained fairly well. afford to save. Less than 2010 Retirement C 10 percent mention each of these other onfidence Survey Underwriters reasons for not saving: confident are more likely than those who are less confident to expect to retire before age 60 and they are less likely to Figure 22, Favor/Oppose Chang Under es to Wit $250,000- hdrawal $5 s Permitted 00,000- $From 1,000,000 Employer-Sp - $1,500,0onsore 00 D d on' Reti t Know/ rement Savings with mos The differe t o nfc t es b he decre etwee an w se o occurring rke Re rs’ po ex r by tp ed e 1 cted Offer 995 ag (8 and e0 of perc re Ta tien ke reme t). Up nt an Th of e E perce d r m eployer tir ne tage es’ act - of Spo work ual a nsg o ers e of retir red ex pecti emen ng to receiv t means t e h ben at a efits error. These include refusals t of coverage include workers with o be interviewed and other for income of at least $75,000 ms of nonresp (compared w onse, the effects of question wording and q ith lower-income workers) and workers age uestion supported b Prepa yr i co nntributions g Financ and g ially rants. for Retirement Saving for R had a median e value o tireme f S n $20 tt rong 0, ly000 Favo for r P those a Sy om for ew Lo h who o at Fng-ter avow r ned a m So mC ehome. w ah rae t O E px pos Sinc pe enses in Retir e t Sh tren, ongly home val Oppose emu eD es have nt on't Know decli /Refused ned nationwide. 1992 1995 2000 to 20 B 01en20 efits 02 R 20 e03 ceiv20 ed 04 by2 R 00e 5tire 20 e 06 s To 2d 00 a7y 2008 2009 2010 cent), or ke cent epi in 1 n9 g 9health 1) and de Wor insu k fine e rance or rs d b had to enef 1991 other tait kep m lans (5 be one 1995 nef y in 6 its (40 ap ercent, 2000 percent do 2005 wn from 62 p ) (Figur 2008 e 34). ercent Y 2009 et fe in 20 w ret 2010 05irees ) (Figwh ure 39, p o havea not al ge 36 r). eady Although retir Moreover, fewer work ee estimat ers say that t $250,000 es of their spending hav A h $4 ey a m 99,999 on ng T d/or th hose e eir spo not $9H 99,999 a chan vuise are ng ge Sav d s $1,499 curr ie gnif d ently ,for ic 99antly b 9 R saving for etiremen eor tw mor een ereti t 20rement 07 an Re d th fu (6 sed 0 pe e pres rcent, down ent (Figure 3 from 6), • A change in employment situation (22 percent). have e Overall, nough worke money to rs are statistic pay for basic e ally as likely a xpenses duri s in 2009 to ng re say tirement this statem (up fent rom 25 describes percen them t in 20 well 09, (52 but percent in still down 2010 an from d steady at ro Plans • ughly 40 Changi , Among ng thei percent Workers .......................................................................................................... r investment very confid m en ix t from (20 perce 2001 n th t). rough 2007 (Figure 2). ...................... 21 expect that Employer Plans • The per they wi centa ll ................................................................................................................ gwork fo es of workers r pay after very they retire. confident about They other are also more likely financial aspect to think s of reti thei remen r sp t have en ................................... 18 ding hel in d r st etir eady at ement w ill This surveyR w eatiremen s made possi t Sav ble ing by t s Plan he fina s, A ncial su mongpport Empl of the oyed fol Wlo owi rkn eg r or s ganizations: from a defined benefit plan has decreased slightly from 11% 62 perc 21% ent in 20026% 5 to 56 percent i 39% n 2010. At the same time, order, and screening. While attempts are considerable gap exists betw series of wi een thdr ex aw pectatio als ama nd c de to minimize these factors, it is im ns and real ould not ity. Just 9 percent of workers possible say they to quantify the plan to retire befor errors that may 4% e age 25–34 (com pared with older workers). Workers Retirees worked for pay in retirement anticipate returning to paid employment. Just 4 percent say it is very likely they will work 65 percHowever, mor ent in 2009 but stati e workers report they stically e All Workers quivalent to will Less t rely on perc han $ent 35, empl 000 ages me oyer-sponsore $35, asure 000-$74, d in 99d othe 9 retirement r yea $75,000 o rs) (Fi savin r More g. g13, s pla pg. 1 ns (75 5). percent in 44 It woul perc • d ent o Having ot be en f retirees r couragin her se g to aport ving fi they nd t priorit hhave m at Amer ies (6 percent aide a cans have djustment of bot bol hs s in tered t workers spend h and retir eiring re i tirement n the ees). pas confi t yea denc r ase a r by im esult o proving t f chanh ges eir i n the 34 percent in 2008 and 40 percent in 2007). Twenty-five percent say they are not too or not at all confident about 48 percent in 2009, down from 61 percent in 20 200 027) (Fig 20 ure 18 08 ). 2009 However, workers who have 2010 saved for retirement are withdraw alVer l of th y e m Som onee ywhat at once Not Too Not At All Don't Know/Refused be abou 12 t tperc he sa ent mefor as medi befocal re tex hepe y re nstes ire, 10 . percent for long-term care expenses, and 21 percent for doing a good job Retirement Savings Gradu Ne ally in eds ...................................................................................................... creasing the cost 96% ........................... 22 Source: Employee Benef EBRI Issue B it Research Instir tut iefs e and are period Mathew Green icals providing exp wald & Associates,e In rt evaluati c., 2010 Reons of emplo tirement Confidenc yee benefit issues and e the 60, com Figure 23, Older percentage of retir workers pare Wo d rkers Having ten with S d our to 31 ce p ees r report : e Erce mple oy Tried to Calculate Ho n portin higher ee t of Ver Benef retirees yg t i amoun t Res hSo ey earc mactually r who r eh wh t Is of assets. ns attitut eport e and No w Mu eceiv t th T Ma o tey retir o hew e ch Mon Se s Vu Greenwal e venty-o rch No y C be te At onf d that e y Th Al nef d id n & lee A n it s t early. percent ey Need to Save for a Co s sDon't has ociatS es d Know o , m Ie Ninet of ne c creas .w , 1992–2010 h work / R ate e C e en fu d osed ers age nfrom fpercent of id Ret ent irem 62 2 ent pe 5– mfortable 3 rcent to workers plan t 4 have total sa 52 pe rcent o retire vings result from them. Source: Emplo94% yee Benefit Research94% Institute and Mathew Greenwald & Associates, Inc., 2000–2010 Retirement The 2010 RCS asked workers and retirees about the extent to which they favored or opposed several measures to The conseque • Inadences of quate f an ina un nces or c planne a 19 d early n’t 91 afford to r retireme 1995 etire (16 W nt can o 20 r00 kers be perc he 2005 ent avy. R 30)% . 20e 08 tirees 32% who r 2009 etire ear 2015 10% lier than 22% planned are more Very Somewhat 92% Not Too Not At All Don't Know / Refused for pay some t As woul 201 d be 0, u ex p ime in pect from ed, the 69 work p fu etrcent u er con re, an in 91% f idence d o 200 91% nly 5) an 6 percent in havi d employment ng eno say u it is gh inco money somewhat me (77 for a com likely. percen fortabl t, up from e retir 70 ement perce in ncreases with t in 2005) (Figure Similarly, t value o preparations f th • h eir e Reduc for retirem decli savings an nin ing g d perc e e d i nt, btn or s entages of reti v but th estments. R pen at may ding (7e rees not be th p tirees ercent very und )e cas .conf er ag ident e. e Alt 70 (com abo hough t ut ha pared hving e percentage of with enou ol gh der workers money to cov workers ) an who reported th e d those who r medical ex rpenses etired ey their ability to pay for Su of be rve basic y.50% nefits to expenses individuals (lev , sel o with the 25 percent measured in 2009) (Figure 3). now more likely to in Confdicate idence S t urv hey e stateme s. nt applies to them (6 4 percent, up from 54 percent in 2009). Confidence Surveys. Respondent Respondent and/or Spouse Sources o of prf epar Retir ing f ement I or retirem ncome ent. trends, as well However, the as cr perc itical analy entages ses of not conf emploide yee benefit po nt continue licies an to creep upwar d proposals. dEB , frRI Notes om 44 percen is a t Retirement ................................................................................................................................................... 22 The Financ likeli Our hiood al Adv of do iceing a r .............................................................................................................. etirement savings needs calculation increases with household income, .................................... 25 education, and ( and Figuinvestmen res 39 and ts of less th 40). 86% Wor an ke $2 rs Ver co 5,0 y uld 00, com not So me with wh p dr ared aaw t an with No y t To 42 o percent of wor Not At All Dk on't ers age 45 a Know / Refun sd ol ed der. At the same time, at age 60–64, although 30 percent of retirees retired at these ages. On the other hand, 24 percent of workers Very Somewhat Not Too Not At All Don't Know/Refused resolve the MORE PEOPLE HA • Never fina getting ncial VE NO peop difaround to it le ficu w SAV ilth high ties faci INGS er in AT ALL (5 ng co perc Soci mes pa :al Sec ent An incr y ofu wo rity eased rkers, 6 and Me perce perc dicar ntage ent of retirees). e. A ofm workers re ong the four por solutions of t they have vir fered tually no for So savin cial gs likely than those who retire on time or later to say they are not confident about having enough money for a (23 household inc perce 41, pag nt, some. te 37 atistically unc ).Worker 5% confidence hanged from 25 perc also increases ent in 200 42% with savings 9) and lo and investments, ng-term care expe educatio nses (13 n, an percent, statisti d improved he cally alth The RCS was c Finally, earlier and/or than th ther eir s pl e ip anne o souse considera -sponsored by d had saved (compa blered room for the Employee Benefit Research Instit for r with monthly e those tirem impr period e who ovement i nt in retir creased ical providing cu e nd o pr briefly n ep time arinin or lat g rrent information on a variety ute ( 2 for r 00E e 9 eB r (75 t than iR rement I),perc a private, no pla amon ent nne ), d) ar it now g at npro e more least som stands of employ fit, no lik npartisan public ely to at 69 eee b of those percent. e have m nefit topics. wh a o say de po Whil licy e AALU/MDRT Financial Litera m cone y Pro y a g tram all unt il they reach 12% 16%Natixis Global 27% Associates 41% 4% in 2009 to 51 percent in 2010 for medical expenses, from 56 percent to 61 percent for long-term care expenses, higher premiums than people financial assets. In addition, married 13% workers (com 14%Repared tirees with unm 31%arried workers), t 35% hose age 35 a 11% 20% nd ol 5% der (compared (compar Although Spending in Retir 18 Overc perc • ent o e The the onfidenc d wit ne f vast majority of retir workers a hed to 8 percent e? ............................................................................................................... ement make u ge of 45 retire p an for 10% d ol lo ees es) sses in the der (96 perc pla cit n to wa e assets of 10% ent stock market it at ) repo lea $2 rt th s 50,0 t until at Soc (1 002 or mor age perce ial 7Security 0n to retir et). (v ersus 4 14% provi e, an p d d e es a rcent o 9 percent source o f worke .................................. 26 indi f incom cate th rs age e 25 ey w for t –3 ill h 4). eir a never n d 10% Figure 24, Security, and investmen •work Method of Determining Savings Need Enrolling in ers are most li ts. Among RC a rekely to tirement S workers favor savi pro ngs plan gradually viding this ed for Retirement, at reduc type of work (5 ing t 17% in percent he curren formati )by Doing a .o 17% t12% n, 27 rate o percent f ben Retirement Needs efits paid say they by Soc have less than ial Security, so Calculati $1, on 000 in ...... that 23 comfortable retirement 12% or about payi EBRI’s ng for 19% Pe bas nsion Inv ic 2 ex 010 pens e 19% stme es nt Re 23% 12% , medic port a provides detailed fin l expenses, a 55%nd lo a12% ncial ng-term car information on th 77% e expenses. e universe of They are The declines in worker con Perfc id eenc ntage e a of b out Employ 13% having ed enough money to 20% pay Perc for me entagedical 13% of W ex orke penses a rs Offeren dd long-term care Nevert status. Those heless, who Americans con have experienc tinue age 66 to lack ed incre or lea c ve ases in i o nfidence their4% jobn14% com in in est (com itutions. J 4% pared with 16% 4 u% st 19 th percent ose whose of workers a income 14% inn 200 d 22 9 was percent o the same f unchan such ad the perce publications g justments. en dtage of from 15 workers percent 5% h 15% i an ving save 2009) appea d for retirem r to have e 25% stabi nt increased from lized. The per 199 centages not c 5–2000, it decli onfident n 22% ed signif about 16% icantly i medical n 2(3 002 1 and per- research organization, and Ma they are very confident. 20% Twe thew Greenwald & Associates, In nty-thr 27%ee percent 30 26% %of very confident 26c., a Washington, DC-based market resea % 37work % ers are not cu22 rrently savin % 26% g 6% for retir rch firm. The ement, 2010 AARP with lower incomes PIMCO 28% 28% 26% 25% 29% Both ex and pected from (amon 30 percent g work to 35 ers from percent 69 26% p for ercent doi in ng a 20 goo 05 to d job 75 perc of pr ent epar in ing for retirem 2009 28% and 2010 ent ) a(Fi 5% nd actu gures 4 30% al (amo –6, pages ng reti 9– rees 10). Private employers 6% 71% with those age 25–34), retirement savers (compared with nonsavers), and participants in a defined contribution plan their spo As one might • Thinki use’s suspect, total retirement ng they had (68 perc ple savings and investments incr nty of ent say time to save it is a major (4 percent source o eas of 35% e shar w f in ocom rkers, 8 ply with househol e), workers a percent of n d retir d th income, edu eir spo ees). use cs continue ation, and he to alth expect retire Changing Ex (Figure pec 31).tations Workers About Retirement W 6% owho ar rkers O defined b e not ffered c Po la enfident nefit, defined n........................................................................................ 8%aboutcontri theirb fi ution, nancia and 401( l security Plank) plans. EBRI Who in r Co entr tirement ibute Fundamentals of Employee expect to retir ...................... 26 e later, on • Few workers report they are likely to purchase a financial product 68% or select a retirement plan option that pays people savings (up fr with hiom 20 gher incomes percent have th in 2009eir ). In bentotal, more t efits cut back han mo half o re than f wor tho ks ers (54 e with68% lo perc wer ent) r incomes (55 percent eport that the total value of of workers vs. Workers may also more likel base th y to report th eir asseir spendin essment of 13% g ho in w muc the first fiv h they e y will NA ears spen of d i retirement 66% n retirement was lower tha on how mu n in ch t th he e yfive years before they will have to spend retirees r expenses in eport retirement they are appear to ve38% ry confident be slo abo winug; t ba howev nks, wh 2009er, ilthey have e 12 percent o not yet stabili f workers an zed. d Th 13 e perc perce ent o ntafges of retirees say t workers who hey are ce Figure 25, or lowe nt in 20 r tha 10 Amount of Savings Workers T n an ind 2 2 008 8 p) or f ercen in t ain ncial assets 2009) and(compare lon hink They Need g-term care (5 d with 33% those for Reti 1 perc whose assets in Ja ent i rement, by Ho n 2010 and 55 usehold Incom nuary 2010 wer percent in 20 ee ............................ 09) the same or expenses also lower 23 do RCS data collection was funde has hovere American Express 44 percent d a have less tha round 70 perc n $50,0 ent thro d by grants 00 in ugho savings, an from more than 3 ut most of t d 33h 64 percent e %200 0 pu 65% 0s blic and pr have (Fi Principal Financial Group gure n16 o t don 11). ivate organizations, wi % e The a retir perc ement entage of nee 9% th staff time donated by EBRI d retir s calculation. ees having saved In for 18% 64% 24% 62% 14% 24% • Lack of faith in Social 18% Securi 19%ty or government (7 per 14% cent). from 34 percent in 2005 to 44 perc Benefit Programs ent in 2010) 21% relioffers a straightforward, b ance on income in retireme asic exp 18% nt fro l62% anation of m 16% an employe employee b r-sponsore enefit programs in d (compared with nonparticip 26 a% nts) more 26% ofte 61%n report trying to do a calculation. 15% 62% • Deciding 18% to work longer (3 16% percent). 27% 24% 12% Despite average, to piec status. Work e to this, than getworkers w eh r those who er their r s who have h eo express confi tirement income Wor have done a kers done co 59 retir ul % a r d not d eenc m e tirement from a te ant savin e ke . a l Those owide va a n ng 15% e s ne e not ds calcu eds calc ri expectin ety of sources. Seventy- lation ulatio g to are more 15 n r% e (com ceivepare retir liked ly than t ee seve with t health n percent of workers hh ose 16% ose insuran wh who o have ce from have not) te not an expect to fee nd to l Retirement Age 24 ................................................................................................................ % 11% 28% ................................... 26 45 their perc househol them ent ofguarant retirees d’s savin eed income ea ). I gs an n cd inv ontrast, retirees are most estments, excl ch month 82% forudi 27 th % n e rest 24% g the lik of el value y to thei favor rai r life. of their Only 20% sing th primary hom 24%11 pe 82% e arc ge ent a e tand a whic indicate they h ny peo def pin le are e can d ben ve be rey gin fit likely p rec lans to eiving , is do In rather t retired. the 20 han 09 RCS, 40 how muc p he it rcent of will cost to mainta retirees indicated that, in an acceptable li so far 21%festyle. in their r T ew tirement, enty-five their spendin percent of 58% work g o 81% ner healt s expect th h care h eir as been are very confident about being able to pay for medical expenses (12 percent, statistically equivalen 27t to 1 % 3 percent in very Ban than i k confi of America n Jan de un ar t about y 2008) ar insura e m no ce compa re likely to nies. express con They are fidence m 10% ost likely to i 15% n hav Prudential Retirement ing exenough mon 29% press confide en y for a ce in 40% pr comfor ivate table em 6% ployers retirem (23 ent. per- not show retirement cli any m statistically meanin bed slowly from 48 gfu pe l ch rcent anges in 19 (Figur 95 to 6 62% es 8 8 an perc d ent 9). in 2006 and 2007 and now 38 stands % 19% at 71 percent (up and Greenwald additio • n Fewer , 13 pworker e . RCS materials and a list of rcent s report t of very confident wor hat tthe priv hey an 79% 22% d/or at underwriters (als ke and ers th who eir spouse hav public s are offer 22%e 30% ctors o listed on pg e.d a e The saved for 21% ret EBRI Data ire. 4) may be ac ment ret savin ibook on Emplo rement gs pla cessed at the E (69 percent, n by their yee Benefits current down BRI Web site: is a from 75 per- employer are statistical 78% 78% Workers a • Bein nd r g i etirees gnorant 29% who and not ag el aiect not nst th infor eir to pur m med a oney c in hase or selec b out the ret planirement 60% t a pla guarant nning e ed-in (3 percent come product/plan o of work 77%ers, 6 percent of reti ption offer a vari rees). ety of retireme Figure 26, Confidence nt Amount of Savings Worke th savat Social ings plans hav Secu 26% rity wil e incrle conti ased. rs T n However, wor u he to ink Th provi 59% ey Ne de bene ed for Reti kers fi are sli ts that a g re htl ment, Among ry e at less likely least eq th u Those a an they l to toDoin day’s v were g a Retirem a inlue some is hiprevio gher ent among us 76% 53% 22% 23% 27% 58% 58%58% 21% confident t have h Social S igh ecurity er l hat evels to be a they w of s ill amajor vin be able to gs or . In minor ad accumula dition, sour ce of thos te the e who incom amount ha e iv ne retir they saved for enee ment, d ret for but th retirem irement ey beli e are m nt. ev T e that o wre likely tha enty-five person 52% per al savings n those cent ofwho those willha also who ve employer (compared with those who do 21% ) also plan to retire later. 26% 26% so, while 35 percent say they are somewhat likely (Figur 56% e 49, page 42). Only 14 percent of retirees report they high full less than Work retirem er tha ing for P $2 ne 5, nt ex000 benefits by o pecte a (Fi y in dg . . 1 Retirement Work 4, pg. ners may also e year 16).................................................................................................. (59 percent be failin of r 73% W g to oe rtir ker take ees s vs. 45 he 15alth % per care c 29 ent of work costs sufficie % 20% ers). Ro ntly into ac ugh 34% ly 4 in coun ........................... 30 t wh 10 eac en h estima report ting spendi Capital Research and ng in the first five Manage yeament Company rs of retirement wi ll be much 26% lower tRussell Invest han in the fivment Group e years before they retire, and another cent of work 2009) and loer ng s and 27 perc -term care exent of retir penses (1 referen 0 percent, ees ce work o very con n level with 10 emplo fidenyt) an ee ben d e perc least l fit pr 71% ent ogr ikely to fr ams and om 2009) s fee work force-related issues. l con hfow iden no cha ce in the nge from federal www. the ebri. govern org ment Others more often confident are men (compared with women), married workers (compared with t 25% hose not married), not contri www.ebr from 62 • cent i ip The .org butin ercen n cost of /r 2 cs gt i 0 to t 0 n R 9 20 a livi but statistically ising t he 09 n pla )g i h(F n e n . ig pay r Worke u etireme r re 12 oll tax equival r)s may .nt wi paid ll ent be t be to hi hinkin gh 72 er tha perc g ab ent 19% n out these ex in 200 pected 8) fai (7 24% (Fi lu percent rg es in ure 56% 11, pag pre ). para etion w 14). 75% h Moreover, fe en they consider wer workers the Needs Calculation.............................................................................................................. 19% 2010 .......................... 24 Instead o •f doi Researchi ng a systemati ng other c retirem ways to s ent a nve for eeds ca retir lculatio ement n, workers (3 perce oft nt).e n guess at how much they will need to workers a reasons for ge no 45 an t doin d ol g so; der th hoan amon wever, the g you most frequently nger workers, 24% mentio and rene tirees ar d reason is that t e more likely 23%23% he t yh cannot an workers t affor 23% do it be (26 conf per ident cent of years to indicate they expect to receive retirement incom 36% e from other 25 personal savin % 15% gs and investments, including IRAs 23% 31% 35% 22% 35% have Like retir not saved to h play adone larees, s g a c e roa a le. olculation ve substantia me worke Roughly re 66% r47 port they a s 7 % are lik l leve in 10 ls of ely to each re savings. I say they a ve find t ry conf hemselves ide nn fact, tici nt t pa h vulner 69 tat they e rec perc e aivin ent o wi ble to ll g ret be able to f those who an un irement pla accu nne incom hav d mulate t early ret ee from not saved h an ie am reme em fo ount th nt. r retirem ployer-s Nevert ey n ponsored ent s hel eed e a, ss, y Banks 33% Although the they favor Deere & Company purchased a rais percentage of ing t by h guaranteed-inc w e payroll orkers fretirees r tax om 1.4 38 pai % ome pro 5% d ve to by ry 1 c w .95% oo d nfident t rkers uct 40% o from r selected a hat t 6.h 2 p ey ha e rcent guaranteed-inc d Schering- done to 7.2 percent a goo Plough Co d ome optio job of 33% (40 perc rp preparin n from a ret ent o g for f wo r irement pl e rkers, 45 perc tirementan. fell from ent of their r 32 perc etirem ent th eint ne nk it eds. will be Workers in t a little lower. he T 20 23 h 10 % irty-one RCS co pe 20% ntin rce ue to nt think be as lik their s ely to 36% pendin exp g l ee ct vels (35 wil pe l rc be ent) as uncha retirees are t nged, while 1o1 per- perce Spending in Re ntages measured tirement in 2009. ........................................................................................................ But while the percentages who are very confident re 35 main t % he sa ............................... 31 me, the percentages (11 percent of workers a those who participate in a nd defin 8 percent ed contri 18% of r bution r etirees). etireme Morent over, the plan (compared with 19% percentages of thos retie rees 20 wh %o somewhat do not) 35% , those confid who r ent ae bport out • Retirement seeming too far away (2 44% percent of workers, 18% 5 percent of retirees). 20% possibility o say that they f becoming fi and/or nan th cially eir sdepen pouse ar den e t on ot currenhers i tly savin n the g fo ir ol r retirem d age: 2 ent (60 perc 5 percent of work ent, down from 65 percent ers who are very con in 2009 fident 45% 172 % 009 21% 56% 76% workers, 2 accumulate. 4 I percent n the 2009 RC of retir 24 ees). % S, 44 percent Other reasons mentio of workers repo ned incl rted tuh de: ey determined the amount they needed to save by (78 about t perce he nfutu t, down re valu from 24e of So % 84 perce cial S Work 49% n er et in curity s co 2 u0 ld0 benefits. not 8). m In ak additio e aHowever, the percentage of n, workers are more likely to retirees saying they say they and their spo are veryu c se onf wid ill ent 59% 22% Figure 27, CLUELESS AB WoOUT SA rker Confid VING en S GOALS ce in Ability to Accu : Many workers 40% mulate R co etirnti ees Need nue to 22 b Retire %e una ment Savings, by Doing a Retire ware o 37% f how much th 17% ey n 17% eed to 8% sment ave for many workers their assets to retirement sav compared with fe tal less tha ings just 1 el th plan ey ar 1 perc (75 ne $1,000. ent of prep percent), ared. those an Se w iventeen n hdivi o have dual p not retir erce done a e nment a t say the statement calcu ccoun latit or IRA on. At the “ (67 percent If somethin other exg ha ) treme, , anppen d o otnly 1 her s and you ar personal 5 percen e savings t of forced Fidelity Investments 17% 9% 12% Schw 25% ab 48% 6% 42% Contact EBRI 16% Publications, (2 47%02) 659-0670; 50% fax publication orders to 54% (202) 775-6312. report retirees Not al 39 perc • l havin worker ent ), whil Needin in g e abo 200 s who (34 percent) a g to 7 to u pa t on have sa 26 y current e-quarter percent i ved ccess to empl expenses first for ret n favor r 200 irement ar 8, eoyer-provi ducin it has r (6 percent g t e curr eh maine e c ded u ently sa rhealth r d stea )ent rat . insuran vin dy since e 46% g of benefits for this ce w then h purpose. at en by they 28 5 p per e Si retire rcent i cent xty for all (Figure percent n 200 n 9 24 e of 37). and % w rec workers i Ho 30 ipi p wever ents ercen n ,the t in many cent Financial Ad believe thvice eir s pending 47% will incre NA ase i 43% n retirement. By comparison, retirees are 45% more likely than workers to report not conf banks Sourc (45 ide e per sn of Retirement Income t c about ent, down being a frobm le 51 to af percent .................................................................................................. ford th iese types of n 2 49% 009), insur expens ance com es cont pani inue es (42 to inc 46% perc rea ent se, from , down 44 from 56 percent percent i .......................... 34 n 200 ), 9 an to d th e Endnotes they or their spouse currently have har be d 14% snefit hip wi s from a thdr 45% awa de l 45% fined benefit plan (compared with t 48% hose who do not), and those about havin but statisticall g enough mon y equie valent y for r 34% teotirement an percentages d measure 34 percent of work d in other years ers who ) (Figure are somewhat 13, page 1 confident admit 5). they worry 38% 51% 12%40% 12% 17% guessing, including 47% 14 percent of those who report having done a calculation. 42% Approximately 2 13% in 10 each report doing about the Needs future valu Calculation.............................................................................................................. e of Social S 13% ecurity benefits has gradually decreased from a high of 28 49% percent in .......................... 25 2001 to just receive income from employment (77 perc 38%ent in 2010, up from 68 38% percent in 2000 and 70 percent in 2005) (Figures 41 Subscriptions to EBRI Issue Briefs are included 13% as part of EBRI 13% membership, or as part of 43% a retirement. L FINRA Investoe r Educatio ss than 33% half n Foof work undation ers (46 percent) repo 40% rt they and/or Securian Financial Group 54 their % spouse have tried to calculate how much to retire two and those who investmen hav ye e ts (6 ars earli done 7 perce a calc er tn hu tan plann )l. ation ar Seventy-se ee d,not you wi at ven perce all ll st confi ill 63% be nd t e en able to ret xt they pect em will ploy ire c rea ment to o cmfortably h their provi goal ” describes t d , compared wit 37 e t %hem with hem a source o h very 24 percent well, a f inn cd ome in of those 10% (23 201 Thirty-o p 0. e Likewis rce ne nt of per workers, e cent of , approxim work 26at p er 37% ely 3 e s who rcent in of r 1 have 0 ret etir no iees) rees conti t saved a 61% (Figure nue re 4 ne 7 to ). vertheless be not covery nfident or about somewhat having confi done dent 28% a tha good job t they will (28 hav percent e their spen employers a 2010 RCS r din erport that they a e elimi g in the natin first g h five n ealth c d/or years o their are cov f r 59% spouse are etie rement rage for was a curre future b ntly saving for out retirees, so the samesome workers (37 retirem perc eent nt (down ) and may fin less likely from d t65 heir perce to report expectatio nt in it 2ns 0 wa 09s lower , but 51 perc Orders/ ent for medical expenses and from 56 percent in 2009 to 61 percent for long-term care 42% expenses. In fact, these federal who exp govern ect to have ment access t (30 perco ent, employ down er-pr fro 11% m ovided 45 percent health ) are insurance (co dec 9%lining m (Fi pared with t gures 19 an 9% hd 2 ose who do 0). not). • Confidenc Already havin e in Enti g a pe tlement Programs nsion, investments or ............................................................................................ income (13 percent of workers, 15 percent of r 9% etirees)........................ 38 about Most workers 1 being financially and retirees believe they dependent 54% on othe are gettin rs during t g alh l th eire in retirem formation ent. they n33 eed to % make sound financial decisions for 52% $199 annual subscription to EBRI Notes and EBRI Issue Briefs. 24% Individual copies are available their own estimate (26 percent) and asking a financial advisor (18 percent). Othe 9% 8% rs read or hear how 8% much is needed and 42). 11 perc One-third of ent in 201 workers who 0 (Figure 44). have saved for retirement 2010 (32 23 12 % percent) say t % 50% hey are very c 62 onfident t % hat t 37% 23% hey are investing Genwo In the RCS, rth Financial retiree refers to individuals who are retired or who ar 8% e age 6 Segal Co 5 or older and not employed full time. mpany Worker money they will need to hav 48%e saved for 27% a comfortable retirement If yes by the time they retire (Fig. 23, pg. 22). retirement an another who have not done • 44 percent say it Wanting to m d 56 perc a ca aent ke sure they lcula describes th expect tion. to r Ove have enough e em rall, 18 perc ceiv so e income fro mewha money to r ent t we om ll. f workers an Amon e employe tire g comforta are workers more ve r-sponsore ry conf bly ide (6 perc dlikely tr nt, 38 perc aditional to f ent).e el pensi ent it desc aro en or cash ribes th somewhat em ba very lance or Figure 28, Workers Reportin 8% g They Postponed their Expected Retirement Age in Past 12 Months ........................ 27 30% 33% dis statistically equivalent enough mon in 2 a0 ppo 08, 33 pe intede . y for a rcent Sourc i comfor ne to th 200 : Emp9, and 27 le oy table perc ee Be retirem nenta efit Re pe ge srcen earc s ent. Ho measured in h I t nin 20 stitutewever, a 10 nd M ) (F a o th ig this per t ew G her years ure 10 reenwa c). enta ld ) & (Fi Age has stea ssg oc ure iates 1 , I3 nc). ., 201 dily 0 Ret 19% decli iremen ned from t Co 6% nfiden c47 e percent in 2004, (49 p •e rce An incr nt). eased percentage of 7% 7% workers re 7% 30%7% port they have virtually no 6% savings an 6%d investments. Among RCS workers are the highest percentages of workers not confi 31 d% ent regarding their ability to17% pay for health and long-term care Insurancwith prepa e companie ym s ent for $25 each (for printed 5% copies). 4% Change of Address: 24% EBRI, 1100 13th St. Use of Guaranteed-In 6% come 5% Products .................................................................................................................. 42 6% their retirement. Twenty-nine percent of 32% workers and 36 percent of retirees say this describes them very well. Another Retireme (9 percent), unt Confidence se an online c 29a% lculator (7 percent), or fill out a 31% workshee 30% t or form (5 percent) (Figure 24). their r IBM etirement savings Su28 rve% y. wisely (up from 24 percent in 34% 2009, but do TIAA-CREF Institute wn from th30% e high of 45 p 33e % rcent measured in 1998). Subscriptions 4% refers to all individuals who are not defined 29% as retirees, regardless of employment status. 2009 14% 53% 67% Among the three solutions offered for resolving the financial difficulties faci 29%ng Medica 30 re, bot % h workers and retir 29% ees are confident, Employer Plans somewhat plan. In contr and 44 percent well are those ast to worker ar who are expectations, retirees are le e not too very or co no nfident t at all 28% con about fident that ss likely to r having eno they u egh money ly on any will be able form for a to of comfortable accumulate t personal sa rh e vings or e tirement amou on nt th (coey ne mpared ed suggestin • Not kno g thw at workers ing enough are increasi about thNW, Suite 878 e nproduct gly recogni (12 p , z Washington, DC ineg th rcent e need of woto rkers, 3 , 20005-4051 save at least some perc , (2 ent of 02) 659-0670; f retir money thems ees). 29 ax number, (202 % elves if they ) 775-6312; would providing this type of information, 27 percent say th Workers ey h 13%ave less tha 26% n $1,0 22%00 in savings 38%(up from 20 percent in expenses in Figure 29, Trend in Workers retirement ever ’measured in Expected Retirem the RCS ent Age...................................................................................... (Figures 4 and 5). 2% 30% ...... 28 Raising the age at which Worker concern about Medicare’s level of benefits continues to be relatively stable (Medicare is the federal health care It should be n 44 Length of Reti percent of o workers an ted th rement .......................................................................................................... 26% at alt d h31 percent ough 56 percent of workers of retirees feel it describes them expect to receive bene somewhat fits fr well. om a On defi ly 2 ne 7 ................................. 43 d perce benen fit t of pla wor n ink ers and Hewitt Associates Towers Watson At the same ti AMERICANS Eme, 8 percent XPECTING TO of WORK LONGE workers changin R: Although g their r th etire e age at ment a whic ge in th h workers re e past year (2 port they percent expec of all t to retir work eers) report shows Another 54 percent are somewhat 24% confident that their savings are wisely invested (Figure 16). Retirees who have 19% most likely to Inversely relatfavor gr ed to conf 21adua % idelln y increasin ce in havi e-mang e g t il: hsubscriptions@ebri.o e cost of nough mone bene y fits for a 21% to i rg comforta ndivi Medu mbe als ble retirem rship Information: , so that e pe ntople is worry with Inquiries reg abo high uer incom t becomi arding EBRI es ng pay Some work Moreover, am Not sur Overall Re 2 by the time they retir with t employment hose prisingl wh ers appear tir fo ong o are e yr their ment Confi , the workers less conf likeli incom e to hav (Figure 27). hood of who e in dence ident e adjusted t retir do not havi ), t e hmen ng saved ose expect to 20% hteir estimates a with (Figure 20% at le for ret rec 38 ast $ eiv ). ire e re 25,0 ment bou tirt th 0 e amon 0 e in healt eir 20% savings an NA likel g hboth workers insura NA y spen 19% NA d i n 20% din ce nvest g fr iom an a n n ments (com retireme d r <0.5 e% employ tirees is nt do pa er, many strongly re wnwar red with ddo those in r late ne oct d to e who nt people are first eligible for 18% 18% 17% 28% like to achieve a financially s 45% ecure retirem 27%ent. 26% 26% 26% Changing Expectations About Retireme One of th Brian K. 200 B e 9). upri cks, I mn Arthur B ary vehicl tot NA al, more NA . Kennickell, e 25% s NA that work than half o Traci L. ers u f worker s March, e to save s (54 and for percent) report Ke nt reti vin B. Moore rement is a that , “Changes in 25% n em thployer-s e total va NA U.S. Family Fin ponsored r lue of the NA e ir ho tire ances from 20 ment savin usehold’s savin 04 to gs plan, gs 24% 13% The propensity to guess or do their own calculation 23% may help to explain why the amounts that 23% wor 12% kers say they need retirement, on insurance pro InCharge Educg atio ly 37 percent ram n Fo 21% for th undatio e elderly rn eport t an hd disabled). at they and/or t Five hei percent o r spouse curr fT. workers are Ro en we Price tly have such very confident t a benefit hwith at th 21% e Medicare system a current or 29 percent of retirees say it does not describe them. Among workers, those who participat20% e in an employer-sponsored Figure 30, little c RCS Meth hange Tre od fr ology nd in Retiree om 20 Under ............................................................................................................................... 09, a lo $250, snger ’ Actual Retireme 000 -term $250, loo 000- k find nt Age s sign $500,ific 000 ................................................................................................. 29 ant cha - $1 n,ge. 000, I 000n - part $1, icular, 500,000 or the perce Don't know ntage /D of on'tworkers ..................... 43 who they w saved for ill r retir etiree sooner th ment sho benefits an t w from a similar r hey ha 65 to membership and/or contributions to EBRI-ERF d 66e plan bou 7%n ne d i d, nprimarily confiden 30 due to ce that % poor they 7% a he ralth or e investing th should be directed to EBRI President/ASEC disabilieir savin ty. gs wisely, from 70 percent 6% 6% 6% 5% Ret5% irees 21% 5% 34% 11% 5% 30% 5%4% household inc appe high financi • ear to Feel r apremiu lly ing they be de t pende ome. ms than aking co nThe healt uld t upeo p pro do on hp c o bette lp e otortion sayin w sts sufficie hers in ith lo r managing the 26% retir wern premiums g tl e they ment or y into acco money t have sav old a (62 unt percent gh wh e e, a ems d fo en nr r e d this a lv of estimat ees (10 perc tirem work ppea e ing ers, 66 percen nt also r how s to ent of work 27% much increa be a real 4% they st of r es as educati ers, 4 concer will 32% etirees). perc nn eed for r fent o oor a siza n levels rise However, r f e retirees tirem ble mi eent ). tir or nority . ees years. In have less) 2007, 20 , those who percent expect to rec of workers bel eive beinef eved thei its from r spendi a 11% define ngd inben the e 44 f fiit pla % rst five n (compa years 55%red of retir with ement those would be m who do not), uc hthos lowe er Worker confidence that they are doing a good job o 29% 2010 f preparing financially for their r24 etirement % follows a similar pattern. 1994Much 199 h5 igher 2000 2001 A little h 2002 igher 2003 Abo2004 ut the sam 23 2005 % e 2006 A littl2 e007 lower2008 M 20uch 09 lo201 wer0 The such as a doand wnwa 40 investmen 1 rd (k). tre Eighty-on nd in ts, exclu Americans’ confi e percent ding t Soci h $49 e val al of 9, Secur 99 d el 22 u ence 9% igible e o ity f th in t 21 workers eir $ % h 999, eir primary 999 ability to (40 percent of all ho $1 retir me an ,499 Em ,e 9 pl 22 99 d a comfortably oyer %n-y d sworkers) s pon esor fin mo e e re d a d t be ppea radi anef ty they ional rs to it r pensi eplans, is membe partici be s ont rabiliz pless t ate ing, in suc han no$25, w h a that pla 000 n 2007: Evidence from the Surv Before 55ey of Consume 55-59 60- r Finances,” 64 65 Federal Reserve 66-69 Bulletin, Vol. 95 (February 20 70 or older Never Don't know 09): A1-A55. MassM to accumulat utual Fin e for a ancial Gro 19 comfort % up 19% able retirement appear to be rather low. The V 24 T aw ng %enty-nin uard Gro e upe p rcent of workers say they need to will continue to provi Emp de loben yer-se po fits of nsored Chairman Dallas at retileas remet equal val nt Salisbur Othu ee r p t eo y rs at the on the al be sav above inef ngs its an addr dreceive ess, (202) 659-0670; d by retirees today, Employme e-mail: salisbur nt while 2 y@ebri.org 9 percent are previous retirement sav employer. ings plan Ther are efo particular re, the diff ly lik eren ely to say ce of 19 perc it describes t entage points hem very may be or somewhat based on th wel e lex . Th pect e like ation of lihood of rece iving the Retirement Age The federal government 15% expect to Endnotes ...................................................................................................................... retire after age 65 has increased over time, from 11 percent in 1991 to 14 perce ............................................ 43 nt in 19 13 95 %, 19 percent in very The RCS or somewhat provides little support for s confident in 2009 to 8 pecula 2 percent tion that in work 2010 ers (Fi who gure do 1 a r 7). etirement savings calculation are discouraged by Retirement Savings 1993 1995 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 are more likel Figure 31, of AmericaComparis ns. y than Seventeen 1992 on of Expec worker percent o 1995 s to in 2000 ted (Workers dicate t f workers and 18 perc 2001 hey favor 20)02 and A raisi 2003 cng t tual (Retirees en 2004 ht of retir e payroll 2005e es ) tax p 2006 Re report or tirement a cash id20 by the sta 07 bal w a o Age ............................................. n20 rkers ce pl t 08 ement an from 2009 “you 1.2010 45 worry a percent to bout being 29 health than pre-retirement, Thirty perc who expect to status i ent m receiv of workers w proves. I e r compar etire n sav a h e he ed with dditio o ings plan do alth not ex n, marri 25 insur ppect eance t ed wo rcen em t in h rkers are ployer rough 20 invest 09 -provide m an an enmo t em s (i d 2 n re likely th c 0 ployer lu d healt 1d 0 in (F g I ( R ig A c h ure )ompare an those not insura 35).n d ce in with th retirem married to ha ose who ent be do not), lieve ve set mon th an ey nee d th ey ose in d aside. to Workers While the who perchave ho entage usehol very co d in nfident r come e under $ mains stable 35,000 (21 (compared w percent, statistically e ith higher-in qcome uivalre e workers n tit to re 20 ), hav perceen less tha t in 2009 n an $2d 5,00 0 2009 11% 48% 59% the economic volatility of the recession has abated. Sixteen percent of workers in the 2010 RCS say they are very with t MetLife h (Fi eirg curr ure ent em 14, page 16 ployer). (Fi gure 21). USAA W 3 save less than hile worker resp $250, onses to a 000, and anot question asking her 17 perce the ag nt me e nti at ow n a hich goal th of ey expe $250, ct 00 to 0–$ retir 49e9 ha ,999. s shown little Twenty-four change betw percent think een bene somewhat fit from a con futur fident i 19 e 93 n emplo the s 1995 yyer—a scenari stem. However, 30 2000 2001 o that is 2002 percen beco 2003m t are ing 2004 increasi not at 2005 all ng confi ly u 2006nlikely, de 2007 nt that since 200 Medicare’s 8private 2009-se be 20 ctor employer 10 nefits will cont s in inue indicating they receive all the information they need also increases with age, education, and household income. 200 • 0, 24 perc Not know ent ing i in t w 20a0s an 5, a op nd 33 tion pe (5rcent perc in ent2 of 01 w 0 (Fi orkg e. 2 rs,9 9 pe , pg. 28 rcen ). t o f retirees). the resu See Paul Fronstin, Dallas Salisbury, an lts. Those who have done a ret d Jia re ck ment VanDerhei. needs “Savings Neede calculation continue d for Health Expenses in Retirement: An to be more likely than those who have not Many workers are adjusting some of their expectations about retirement, perhaps in response to their reduced level of Other accumulate 1.95 financi pgroups e arcent lly de le (59 pende ss than $ of work perc Son urce: t on ers mo ent o 2 E 5 oth m 0pl ,f000 o re like retirees vs. y e ers dur e for Bene l retir y to fiing you t Rese ha e44 perc a ment, an rc ve saved for hr Ins retirem tituent o te d a ane d n fnt M wo r aadditio /la th eew tirement rkers) an ter years” describes t Gren enal wa15 inc ldd r & perce Aa lu sising t sde oci those a an tet thi sh , In e age at ch n ., em k t 20 g10 eh 45 ve R ey w e whi rty an ire m w ill c e d ol e nt h nee ll. Co peo der nfi Anot d dp $25 e(compar le ncher 23 perc eare first eli 0,000– ed wit $49en g 9ih ,99 bt le of for 9. excell Editorial Bo ent or very goo ard: Dallas L d h. Salisbur ealth (com y, publisher pared ; Stephen Blakely with those in, editor good, . Any fair views or poor expres healt sed in this p h). ublication and those of the authors should in savin 23 Theperc perent g centa s an in d investments ge of 2008), S workers our the ce: E p me p lrwho (compare oy cee entag Bhave virt enee fit not Res d wit earc c ually no o h hnfid those Institent co ute and mone who M nti a h ty in savin hew G nued ave more reen to i wan g ld), or crea s a & An sse, from sd i have not ocin atvestment es, Inc.28 , do 2007–2010 pe ne s has incr rcent i a ret Retiin rem reme e 200 ent ase nt 8 d over and savings ne 30 the pe pas rcen eds t year. t in MFS Investment Manageme Source: Emnt ploy ee Benefit Research Institute and Mathew Greenwal Wells Fargo Institutional Retir d & Associates, Inc., 1991–2010 Retirem eent ment and Trust Figure 32, confident tTiming of Retiremen hey will hav 1998e en 2o 0u 00 ght, Among Retirees money to 2001 20 02 live comfort 2003.......................................................................................... ably th 2004 rou 200g 5hout 20 06 their r 20 e0tirem 7 2e 008 nt years 2009(stati 20stically e 10 quival ........... 30 ent to Source: Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc., 2010 Retirement Confidence Survey. they need to save $500,000–$999,999, while about 1 in 10 each believe they need to save $1 million–$1.49 million (8 200 particular to equal or 9 and hav 20 e1 xe 0 ceed the been , the Source: a cuttin g bene e at Em g pwhich l back o fits rece oyee Benef work n iived t th Research ers say they eir b y defi ben Insne titue td e fic and ben ipla aries Ma e n tfi h to today ew t off G retir reenw erin e (al F g has c d & ig s. ure A ssoc r 45 ept iat). es, upward incrementa I nc., 1993–2010 Retirement lly over time. In Survey. Source: Em19 plo98 yee Benefit Research Institu 2t002 e and Mathew Greenwald & A 2009 ssociates, Inc., 1992–2010 Ret 20 ire 10 ment not be ascribed to the officers, S Conf S ourc ourie ce d:enc : E E m e S m pl po u lo y rv y e trust ey e ee s B Be .enef ees, neifti Res t R meese earc mabrers, or ch h In Inssti tittut uother sponsors of the E te e and and Mat Math hew Greenw ew Greenwa alld d & m & Asso A ploye ssoci ce ia at Benefit Research te es s, , IIn nc., c., 2199 0091–201 –20100 RInstitute, the EBRI Educ Ret etirie rem mee nnt t ation and Examination of Persons Ages to say they are very Conf cio den nf cid e S en u55 and 65 rvt a eysb . out h in 2 aving 009.” enou EBRI Notes gh money f no. 6 (June 2009): 2–11. or a c 1996 omfor 2001 table retir 2005 em 2008 ent (22 2009percent vs. 10 perc 2010 ent). confidence about their 1996 ret 2001 irement f 2005inanc 2008es. T 2009 wenty 2010 -eight percent of workers in the 2010 RCS say the age at which benefits from 65 workers and 22 percent to S66 (55 percent ource: of r Eme pltirees oyee Benefi indicat of tr Research Insti etire it ees vs. 3 descri tute 9 and bes t per Mac h thew ent of em Gree somewhat work nwald & er As) (Fi ssoc wel iates g l. ure , In c 4 ., 2010 8). Retirement Confidence workers a An Employe • Those ge e25–44), who Beneha C fit onf those c ve saved for Resear idence Such Institut u rvrrently eys. retirement part e st icudy ip hav atin fin g in e d recover s that a wo men a rk plac ed some conf ge e ret 65 a irement savin nide d who nce retire in the gs i ir a n plan 2b009 ilit (com y to invest t will pared with t need ah ne ywh ir savings hose n ere fro om t calculation 200 Among RC Morgan Sta 9 to 35S (compared w n p ley Smith B w ercent i orkersn provid 201 arney ith t 0 in (Fi hg t ose w ghis ure 6 type ho hav ). In of one informat e) are mor sense, ion, e l hio 54 kweve ely to su perc r, t ent r hppor e in eport that creasing lack t changes r thee t quiring in o of con tal value fidence divi ofdu t h among als to purchas eir househol worker d’s e s about a the low of 13 percent meas Confidence Suured in rveys. 2009). Forty-six percent are not too or not at all confident they will have enough One-third of workers (33 Co Cnf onf iden iden cc ee S per S uu rv rv c ee ent) an yy ss .. d retirees (32 percent) report they have sought investment advice from a Source: Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc., 1994–2010 Retirement particular, Figures IN percent) or STI • Resear Not trustin TUT ch Fund, ION the perc $1.5 mill AL CON g or or S their our enta be ion or ceF staffs. : lievin I ge o E D mE p m N lo Nothin fg y CE workers o ee in t re (9 LAG Benef g her hem it R G perc IN ee who in is to be co (8 sear G ent per :c h Americans con expect to ) I. Ho ncsen titut nstr t of e wever, and ued as an attem workers, retir Mathew se tainue vings aft Greenw 2 e to lack r a perc pt to aid or goals t ald ge 65 has in &ent o A c ss hi e o ocnd to in nfidence f inder at res e,t the adoption iIn rees). creased over tim c., 1993 creas in –2010 Ret inestitutions. as ho of anyir pending le eusehol me ent , fro Thd in m ey are gislat 11 percent come rises ion, most l regulation, i i kely to n Figure 33, Comparis Su on of Planned rvey. (Workers) and Actual (Retirees) Work for Pay in Retirement ............................ 31 Working for Pay in Retirement Moreover, those who think they need to accumulate at least $1 million in retirement savings are six times as likely as 4 they expect to retire has changed in the past year. Of those, the vast majority (87 percent) report that their expected partici $68,00 p0–$ atin17 g), 3 ,those havin 000 Sour Conf in cid saving een : Em ce S pl g u oy rv attempte s to cover ee eys Benefit R . d a eshea earc re h lth insura tirement Institute and M savi nce athew ngs prem Gne reenw iums ed ald & s c and a As lc out-o su olca iates tion f , I n pocket ( cc ., omp 1998–2 ex ar010 epenses d R w eti ith rem th ent in r ose etirement who ha if ve not) they , and wisely. ThC irty-two onfidence S perc urveyent s. of workers indicate they are very confident (up from 24 percent in 2009) an d another guarant the a savings an or interpretative dequacy eed-in d inc of their vome pro estments, ex S ru ole, or as urce: financ Em d legal, uct ployee icludi and tak aacco l pr Ben ne eparat unting, g t fite Resea h th eactuarial, o val ion eir rchsu money in Insti for ret e of tute r th other such prof an ieir rement may d M a series of pri athe m w ary home Gressional advice. eenw with be ald & goo dra A an ssd d any ow n cials rath ae tes, ws. defin Inc Work ., e 1996 r th ed –20 ers who an all bene 10 Re fit at o tire adm pla men nn te t s, Co it they infi is less than me. dence This mi lack $ght be 25,000. Life expectancy was calculated by adding expected age at retirement and expected length of retirement for workers money to live comfortably (statistically equivalent to the 44 percent observed in 2009). Overall retirement confi dence professional financial Source adviso : Employr over th ee Benefit Res e pas earct h year. Institute an Those d Mathew G with re higher enwald & le Asvels of sociates, Ifina nc., 1998 ncia –2010 l assets are Retiremen t more like Confidence ly than those expr (Figur ess confi e 25). dence in private employers (23 percent of workers and 27 percent of retirees very confident) and least 1991 to 14 percent in 1995, 19 percent in 2000, 24 percent in 2005, and 33 percent in the 2010 RCS (Figure 29). Confidence Surveys. Figure 1, Worker Confidence in Having Enough Money Enough Money to Live Comfortably Throughout Their On the other hand, Surveys. 36 percent of workers and 43 percent of retirees say this statement about worrying about financial those who think they need less than $250,000 to be very co nfident (36 percent vs. 6 percent). retirement a Figure 34, Reasons for ge has increased. Working for Pay i This means that 24 n Retirem perc ent, ent of Among Retirees all workers pla Wnned to ho Worked postpon for Pay e th ei ............................... r retirement in 2010. 32 The RCS has consistently fou Surveys. nd that workers are far more like ly to expect to work for pay in retirement than retirees thos want a e who 5 54 perc 0– cur 50 rent chance ently h are of a somewhat ve a bei n defi g ane b co le d to hav nfident benefie t pla (Figur enou n (compa gh e 1 mone 6, page 1 red y, and with 7). $ thos Retir 134, e0 who e00– es w $3 do ho have 78,0 not). 00 saved for r if they prefer etirem a 90 ent p show a ercent ch ance. because confidence Moreover, 2 they a7b out their recogni percent say th ze ret they ireey have ment will hav preparat less t e diffih c ions may be an ulty mana $1,000 in gin more wi g savings (up fr the mon lling t ey. oom 20 make corr General percent ly, th ections and acce ose with in 2009 hi ). ghe Approximate pt a r income dvice t or as h ly 1 an are sets in 10 • Lack of interest (6 percent of workers, 4 percent of retirees). providing both pieces of information. has fluctuated over the 20 years of the RCS, reaching its highest levels among workers in 2007 (27 percent very with lower levels of assets to seek this advice, but whether this is because higher-asset individuals feel a greater need One reason for the difference between workers’ expectations and retirees’ experience of retirement age is th at many Nevert likely to heless, the fe Retirement el confidence median Years in (midpoi t.............................................................................................................. he federal nt) age at government which work (11 perc ers ent expect of work to reers and 8 perc tire has remained stabl ent of retir e at ees 65 sin ) ............................. 7 (Fig. ce 20, 1995. pg. 20). dependence does not describe them at all, including 65 perce   nt of workers who are very confident they will have EBRI Issue Brief is registered in the U.S. Patent and Trademark Office. ISSN: 0887 -137X/90 0887 -137X/90 $ .50+.50 Whil are to e simil have ar t aco tually the level worked. reported i The perc n 20 enta 09, this re ge of workers presentsplan a substantia ning to work for l increas pay i e over n retirement no previous year w stan s, when ds at less t 70 per- han With their greater longevity, women will need more: A women retiring at age 65 in 2009 will need anywhere from those who similar re are convinc bound in ed t con hatf their idenc retir e that em they ent ar preparatio e investins are o ng their savin n tracg k to provi s wisely, wit de th h em 82 percent with a co saying mfortable reti they are revery ment. think th Figure 35, each report ey can Trend in Post-Retirement vs. Pre-Re totals of manage t $25,00 heir0–$ resources 49,999 (12 with perc out a ent pro tirement Spending, ), $ ble 50 m. ,000–$99,999 A m (11 ong Workers percent), $10 .............................................. 0,000–$249,999 (11 percent), 33 5 confident), 2005 (25 percent) and 2000 (25 percent) and its lowest level in 2009 (Figure 1). Americans f of investment indadvice themselves or beca retirin use pro g ufnession expectedly. al advic The e in cre RCS ha ases sthe l consi ikeli stently fou hood of buil nd tdi hng asset at a large level percentage of retirees s is unclear. Other Just 19 percent of workers and 22 percent of retirees report they are very confident about banks, while 12 percent of 2009 OASDI Trustees Report, Assumptions and Methods Underlying Actuarial Estimates, enough money for a comfortable retirement, 38 percent of workers who are somewhat confident, and 23 percent of Figure 2, Retiree Confidence in Having Enough Money to Live Comfortably Throughout Their Retirement 20 percent said they had postponed their anticipated retirement age (Figure 28). cent • (u Not p from being o a rece ffered o nt lon w o e at wo f 63 perc rk (2 percen ent in 20 t 08 of work ), com ers, 8 pared percent of reti with just 23 percent rees). of retirees who report they worked $98,00or 0–$ somewhat 242,000 in confident savings to cover (up from 7 hea 0l th insura percent in nce 2009 prem ) (Fi iums gure and 17 out-o , page f- 18 pocket ). expenses in retirement for a 50– and $250,000 or more (11 percent) (Figure 14). Retirees provide similar estimates of total household savings (Figure sources of information that workers and retirees turn to for financial advice are: ww leave t w.ssa.gov/ he workO force earli ACT/TR/2e 0r 09 than /V_dplann emogra ed phic.html (41 percent in #216 20 02210 ) (Figure 32). Many retirees who retired earlier than workers an Figure 36, Trend in Post-Retirement vs. Pre-Re d 13 percent of retirees say they are very tirement Spending, confident about A inm surance com ong Retirees panies .............................................. (Fig. 19, pg. 19). 33 Years ............................................................................................................................................................. 8 those who are not confident. 3 for pay in retirement (Figure 33). 50 chance of having enough money, and $164,000–$450,000 for a 90 percent chance. 15). © 2010, Employee Benefit Research Institute -Education and Research Fund. All rights reserved. planned cite negative reasons for leaving the work force before they expected, including health problems or disability ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org ebri.org 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 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 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 e e e e e e e e e e e e e e e e e e e e effffffffffffffffffffffffffffffffffffffffff • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 • March 2010 Education and R • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 • No. 340 esearch Fund © 2010 Employee Benefit Research Institute 13 21 10 32 26 17 29 31 30 20 40 24 33 28 42 37 27 39 16 36 38 18 11 43 12 35 41 19 14 22 23 15 34 25 9 8 6 5 7 4 3 2

Volume 340

Pages 44

EBRI Issue Brief

Ruth Helman

Craig Copeland

Jack VanDerhei

Retirement