In a sign that Americans are recognizing the realities they face about their chances for a comfortable retirement, the 2011 Retirement Confidence Survey (RCS) finds workers are more pessimistic than at any time in the two decades the RCS has been conducted: More than a quarter (27 percent) of workers now say they are “not at all confident” about retirement, up 5 percentage points from the level measured just one year ago. Reinforcing that trend, the percentage of workers saying they are “very confident” of a comfortable retirement ties with 2009 at 13 percent—the lowest rate ever measured by the RCS.

RECORD-LOW CONFIDENCE: The 21st wave of the Retirement Confidence Survey (RCS) finds that Americans’ confidence in their ability to afford a comfortable retirement has plunged to a new low at the same time that the recent declines in other retirement confidence indicators appear to be stabilizing. Instead of making fundamental adjustments to their spending and saving patterns in response to the decline in confidence, workers continue to change their expectations about how they will transition from work to retirement in what has been called an age of “the new normal.”

WORKERS NOT CONFIDENT: The percentage of workers not at all confident about having enough money for a comfortable retirement grew from 22 percent in 2010 to 27 percent, the highest level measured in the 21 years of the RCS. At the same time, the percentage very confident shrank to the low of 13 percent that was first measured in 2009.

INCOME BREAKS: The increase in the percentage of workers not at all confident about having enough money for a comfortable retirement appears to be largely due to a loss of confidence among those who have less than $100,000 in savings. This percentage increased sharply among those with savings less than $25,000 (up from 19 percent in 2007 to 43 percent in 2011) and between $25,000–$99,999 (up from 7 percent in 2007 to 22 percent in 2011).

RETIREES: Retiree confidence in having a financially secure retirement is stable, with 17 percent saying they are not at all confident and 24 percent very confident (statistically equivalent to 2010 levels).

SAVED FOR RETIREMENT? Sixty-eight percent of workers report they and/or their spouse have saved for retirement (down from 75 percent in 2009, but statistically equivalent to the 2010 level). Fifty-nine percent say they and/or their spouse are currently saving (down from 65 percent in 2009, but statistically equivalent to earlier years).

LITTLE OR NO SAVINGS: A sizable percentage of workers report they have virtually no savings or investments. Among RCS workers providing this type of information, 29 percent say they have less than $1,000. In total, more than half of workers (56 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.

NO RETIREMENT SAVINGS GOAL: Many workers continue to be unaware of how much they need to save for retirement. Only 42 percent report they and/or their spouse have tried to calculate how much money they will need to have saved by the time they retire so that they can live comfortably in retirement.

EXPECTED RETIREMENT AGE RISING: The age at which workers expect to retire continues its slow, upward trend. In particular, the percentage of workers who expect to retire after age 65 has increased over time, from 11 percent in 1991 and 1996 to 20 percent in 2001, 25 percent in 2006, and 36 percent in 2011.

MORE EXPECTING TO WORK IN RETIREMENT: More workers now expect to work for pay in retirement. Seventy-four percent report they plan to work in retirement (up from 70 percent in 2010), three times the percentage of retirees who say they actually worked for pay in retirement (23 percent).

Figure 36, Comparison of Expected (Workers) and Actual (Retirees) Retirement Age ........................................................... 30 Figures Ruth Helman is research director for Mathew Greenwald & Associates. Craig Copeland is senior research associate at Figure 1, Average Confidence in Having Enough Money for a Comfortable Retirement, by Quartile of Age-specific Figu the Employee re 37, Timin Bene g of Reti fit Resear remench t, Amon Institut g Retirees ............................................................................... e (EBRI). Jack VanDerhei is the research director at EBRI. This ............................... Issue Brief was 31 Although the percentage of retirees who are very confid ent that they had done a good job of preparing for Worker to accumulat preparations for retirem Evaluation of Progress Confidence in Other Fi Security Similarly, t do not Not al and j Furthermore, (23 percent), Expectations About Retireme Whil RCS Methodol Preparing income retireme The most of the likeli ? ? e r us l )e worker concer , those who tfrom a spons nt (do The A statement u has gradually 4 hood h per p e age at e e percentages among t and c s who e the for Retirement n w n abo of do rcentag ent r s to a em n from 24 percent amount havin report they or their s wh ployer-s ing a re e ogy u have sa port t t Me qu incr e h n ich s me ose g e der estion asking the to nt may be dic o t e h workers e certai ti ponsored tra a who h ey d fasured nancial Aspects of Retirement care for ved retir in Planning and Saving for Retirement rement savi are’s l s ey n ed from e have tak for ret creas e e n a ed, es very e in 20 from vel o goo a x ssumptions about how mu pect to 3 co spo e irement ar 0 d d t 07 d ngs nee fp mpared w news: Work 2 e iti percent age o b nt u 003 n the retire confident he ), u e o se or a se curr retir nef nal 2perce –2 8 at w perc its was r pension d 010, not at e curr e s calcu n hich intag continues th j entl othe ent have a b me er b u u ou y have ben en workers expec s who a e st 11 o r e tlall con nt pl . a lowe family lttly a rtion inc h cas Whil tively stabl asaving fo percent anni v its slow, u lr tha e ih fng c e d ss member (18 ident h mit balanc 3 ng step o rease retirem e e than n perc fits n t th ou of t io e t to retir r n from uncert s e 5 2 g e this purpose. $2 ent of p f with r pla h wa 002 h om 20 e m 5,0 3 ose nt f rd tr perce n, an doin o a de percent to househ 00 in in work n ainty ewho e come they sho 03 y end. 39 g a fin d n to to 2009, sa t r ers 45 about t e perce w have not cover retireme In d bene old i )vings (do Fifty-nine percent e s little cha . Others say changes in off corde perce pa n n e co t in come, h red medical expenses but rtic fit retir eir d nt e do uld nt n i 2 a ret w ular, th n has n 0 ne pla x n fr ex 20 0 ge from e p ei9 a calc eds rement ec d e pect 00 a an n s ucation, ment plan om it n to rec e creased d a fro n 35 y they o 20 ulation. d one f the m per- 11 an e ive d Preparedness for RCS Workers: 2010 vs. 2011 ...................................................................................................... 5 Figure 47 retirement fell from 39 percent in 2007 to 26 percent in 2008, it has remained steady since that time (31 per- written with assistance from the Institut st e’s research and editorial staffs. Any views expressed in this report are those of Major findings in this year’s RCS include: F Fi igure 38 gure 19 Figure Figure 37 7 Figure 38, Comparison workers in year to a cent), preparations At the ot in rec the skills r 47 perc (Fi stopped contri income calculation, financi (compar (27 gur perce e an e 4 al asset nt y ent in 200 from a e percentage of workers who expect to retir the mon her n d 3 4). d wit ne other, the long-ter the 2011 RCS e t, s co qu ar e 3may be s (Medicare is ix ts perce nfidence butin r h payout atistically unc treme, o . In a ed those e of Expected (Workers 8 (F y in for t g n more i t hav d igur t n ann dition, who heir in th h nly e report that th ac e 24). e e plan job uit do not), 1 willi past year, t not don hievin hanged from the federal 5 m trend shows that the a married y. In contr percent if ng to mak (8 they perc g th those e a continu work of eir r ent ) an ret ey a his ast health car t e )23 is offset h e d i correctio who rement ers (com or other n to worker tirement ose w Actu d/or perc e to expect to al (Retirees) Work f their h ent save at t e ne o hav e wo i by th pared with ns savi aft n ex eds in sur grk-related reason spouse are and a e e 201 pe e ngs go e 2 percent at calculat r a have ance do ctations, retir h g 0) an which e r ne ccept e 65 access t program unm a al h a calc te they d lo i has increase on curre wor a as r oarried wo d who say they started or r Pay in n (st vice tha u g k e l o -term ation ar atistically e are ers plan for the el ntly saving for retirem ees are maine s (2 employ saving Re 0 care n rkers), t perce d l ar d over tim tiremen e not less lik to r er-pr e der e t vel e qnow n h x e ui l y and disabled). Five t) playe pe tire has ose who are at all h o since 2 valent to tose age 35 a vided he ely to r .................................. nses (16 (89 e, fro confi percent d 0 crept restar 0 e e m a rol the 5 ly on alth nt d percent, 11 e (Fi n (down convince 3 e upwar t they percent ted t n g insurance ).7 any form .d ol ure Some percent h 2 der from eir d will 8 d ). i n ........ of 32 Introduction Figure 30 Saving for Retirement These findings are part of the 21 annual Retirement Co Figurnfidence e 43 Survey (RCS), a survey that gauges the views Whe Although n workers overall reti are asked to rement confidence evaluate their am progress i ong workers h n plannin as decl g a ined sh nd saving arply i for r n th etire e pa ment, 7 st year, conf 0 percent state idence about that Retiree Confidence That Medicare Will Continue Retirement Age cent in 2011). Likewise, 13 percent of retirees conti Figu nue re 17 to be not confident about having done a good job Total Compar Savings isoand n of IExpe nvestm Figure Fig cted ure e 41 20 nts Repor (Workers) te an d by d A c Reti tual rees, Figu the aut re 2, Work hors aner Con d shoul fiden d not ce in be ascribed to Having En Work ough T t ier ming of h M e officers, tr Confid oney to Retireme ence Live Comfortably T ustees, or other sponso in Doing nt, Ama Good ong Retiree hrou Job o ghs o u rs of EBRI, EB f t Their Retiremen RI-EtRF, or Years thei ..................... r staffs. 8 st Timeframe When Retirees Began to Plan Financially contributio that their ret retirees m measured in perce incrementally reach t 65 personal (compar (compar statistically perc nt of h ent eir e e savin 199 d d wit e wor n wit go nti in un s (inclu 1 a 2007). In iro 200 al, compar over time. e changed g h thos h kn positive reasons for ret ment nd s, on those ers are v 9, 19 ded in but stati e prepar employ 96 age 25–34), who addit from 13 perc to In ed e th ry d 20 ations are likel with e 2 confident t particular, ment, or o s o iExpe on, 10 tically e pe not), 8 27 rcen perce ct retir perce an ed ( ent in 201 percen t in quival the perc d th n n h e W t o i a at ri m 20 n orke ng y to n t of e os fent to t the Me t of very con ann part 01, nt savers e who early, suc provide t those rs) 0) 25 enta uity icipants r v are dicar h perce s. s e ge for t a per wh A st (c y t o ct h e able. The h o fo have nt in as fh u hey do is m em centages mea workers d e eir y aent portin pared with n stem will l wa ( 2 with income in R workers 0 et not ntin not 0 g a i perce 6 ra co ees) , an who g to do ha n con ine a mfortable retir n d do s ve a retirem s Part who ar c n expect to o ured t36 rease, as not tages nsavers), an inue calcu per io probl ci met to provi in oth p e o c e at not at ent i nt lhin atio e iffer o retir m n (Fi eg r n 2 n. Over e with e els years) (Figur d g all con e d e ment. d a ure 40). d a aft e bene partici 0e 1 retir de b 1 e (ove). 25 .r a bt fall, ident p fits of e g perc ants (co ment savings e 65 has 17 m a e 1 perc ent) a in a b pared out t6 least or ). defin ent o w bein ith fe d g and attitudes of working-age and r to Pr etired ovide Americans re Benefits of gardin at Least Equ g retirema el V nt, th alue eir preparations for retirement, March 20 they are a other f 11 • No. 355 inanc lot ial(40 percent) o aspects o f retr a litt irement le has r (30 percent emained rel ) behiativ nd schedule. ely stable a Th fteis is 15 perce r declining thr no tage ugh 20 points 10 fro higher m highs in than Figure 39, Reasons for Working for Pay i The 21 wave of the Retirement Con n Rfetire idenment, Among Retirees Who Worked for Pay: 2010 ce Survey (RCS) finds that Americans’ confidenc ...................................... e in their ability to 32 It would be heartening if American workers reacted to their decline in confidence by improving their Con (statistically u fidence tha nchan t Socged ial S fro ecur mi 16 ty w p iW ll e W c rcent or o or (Retire ke n ker tinu r i s s n 2 Expect e Who to p es) 009W Think It R an riovid o ng Ret rk d for Pay 11 e bene perc ire em asonably fits th ent ent in Retirem Iin nc at a 20 om Po 10) re at e Fr ssible ent (Fi om least e gure 1 q1 u)al to to . day’s value is AA mm ericans ong T hose Reportin Prog vi They ding a DiResponse pped Into ? The percentage of workers n Preparing Financial ot at all confident aly b out for havi Retirement ng enough money for a comfortable Many workers are adjusting for R some of t etirement, heir A m expectations ong Retirees Who about re Planned for tirement, perhaps Retirement in response to their reduced Neither EBRI nor EBRI-ERF lobbies or tak in Empl es p oositions on sp yer-Provided ec Reific tiree poli Heal cy proposals. E th Insurance BRI invites comment on this to Benefits Received by Retirees Today Figure 3, Retire increase plan able to afford workers are v contributio equal those who medical by t valu (14 percent dh, fro eir e to hav e Con n c pl e m the an ear u an (compare e ry confident, 37 11 rrent a major fiden be p in ce in Havin lercent y retir employ nef 2011 and 15 or its r i e d minor pro n 1 e ment er are not with ceive g perc 991 En nonpartic (22 perc d an ou ent a percent in by reti b gh con d lem M 19 re somewhat ) o e t96 to rees today, .ributin ipants) more n n e t)y to 2010) , b 2u L g 0t ju to ive Comfortably T perce an the plan co st w d 6 hile nfident, a often r nt in pe lon25 rg c 2 -t e percen (statistically equivalent to the 14 e n 001, erm c port t o nd 4 fh 2 th tr rou are 6 t are somewh 5 ying to e perc percent t g(30 percent in h oo ta u ent l o t Their Retire do ff are in e a c r20 only at confi alculation. not too or not 06, a 2011 an pmen ositive reasons. nd d 3 etn Years 6 t in d 27 percent per pe the rcent i at all cent ..................... system n th in e 8 their confidence with regard to various Sav to aspects of S ings ave $25 to Pay retir a W fo eek ement, an r B fasic or Re Ex ti d r remen penses elated issues. t The survey was conducted in afford a the 5 2007. 5 In perc comf parti ent ortable cular, of workers retir 28 perc ement has went of ho felt work Soci behi plun al ers are nd ged to a Securi schedul now tFigur y ne e an very iw n d e 2 l20 Def ow at t 3confident t 05, ined Ben whe he same time that n th ef hat iis t Pl question they w ans ill was th have e rec l ast asked in enough mon ent declines in te hy to pay e RC other S. for (not including value of primary residence or defined benefit plans) preparations for retirement, but this does not appear to be happening. Although the percentage of workers high ? e r amon More work g workers a ers now ge 45 an expect to d older work than amon for pay in g yo retir un eger ment. workers, Seventy-four and retirees ar percent report e more likely they t plan han to Figure 40, Expected (Workers) vs. Actual (Retirees) Sources of Income in Retirement ......................................................... 33 retirement grew from 22 percent in 2010 to 27 percent, the highest level measured in the 21 years of level of confidence about their retirement finances. Twenty-three percent of workers in the 2011 RCS say the research. Not sur prisingly, the likelihood of having saved for retirement among both workers and retirees is strongly Earlier Than Planned AbFigur out We 28 hen Planned Later Than Planned 201 confident t measured in (do 2010) exp w 1 n Rfrom CS (Figure 34 ehnses also d at 2 34007 they w percent ). ). ill o in be not show any statisti Neve 2 able to 003 rtheless, Fav ). or T accumula /hirty-f Oppose Changes t the median our percent te the cally mea amo (mi dpoint) age ar o n unt i e not n the gfu they nee Rul l at al ch eanges (Figures s at w Regar l co d by the nfident t hich workers e dingtim hat M e 9 an they retire (Figure 27). e d 1 xdicar pect 0).e to ’s ben retire efits wi has ll January 2011 through 20-minute t Very ele Sophon mewhat e intervie Not Tow os wNo ith 1, t At Al 25 l 8 in Don't div K iduals now/Ref (1, used 004 workers and 254 retirees) Figure 4, Work Whil basic e e th xpense e er Con percsentag durin fidenece in g of re wor tire Havin ment kers who g En (do ough w say t n M from 40 o hey are ney to Pay for Basic Ex percent ahead Figure in of sch 20 31 07, edu pen but le s statistically e es in has chang Retiremen ed litt qu t .................................... ivalent to le (7 perc the ent i 29 n 2perc 005,ent ........ 9 retirement confidence indicators appear to be stabilizing. Instead of making fundamental adjustments to their who reported they and/or their spouse had saved for retirement increased briefly in 2009 (to 75 percent), it workers to be work in confident retirement abo(up ut the futu from 70 re value o percent in f Soc 201 ial 0), Security three times the perc benefits. Howev entage of er, the retirees who percentage of retirees say they the RCS. At the same time, the percentage very confident shrank to the low of 13 percent that was age at which they expect to Workretire er Conf has cha idence nged i in Abn il th ity e topa Ast year. O ccumulate fSa thv ose, the vast ings Needed majority (89 for percent) related to Instead of hou doin sehold g a systemati income.c retirem T Veh rye propo So em nt ew rti n he on saying aeds ca t No Wo t T lculatio rker oo Figure 5 they s No n have saved , workers Ret t Ati rAl ees l oft Donfo 't Kn er retirem n o guess at w/Refuse ed nt ho alw muc so increases a h they wil s l need to Figure 41, Workers Expecting Retiremen Ret t In ir 1991 ecome Fr ment19 Sa 96om S vings 200 oci 1Pl al S Figu an 2e 006 s, cu re A 22 rity an m20 ong 09 d W Defin 2010 orker ed Ben s2011 efit Plans ........................................ 34 2002 2006 Figure 40 2007 2008 2009 1 2010 2011 remaine continued stable at to equal or 65 exc for e m ed othe st of this t benefits r Prefer ime e. ceived by red Appr be oach to Making neficiaries toda D y, an in ecision crease s from 29 percent in 2008 Figure 11 age 25 and older in the United States. Random digit dialing was used to obtain a representative cross section spendi 8 percent measured in ng an in 2 d 2011 saving 010), t ). T he pattern wperc elve entage s in res percent say they are not at who i ponse t ndo icate the dec they line ar2% i e on all confident n conf track has idence, a dec bworkers out their ability to pay lined from conti 37 nue to percent cha for in nge basic 200 their 5 to The year you retire Fi dgure 35 dropped in 2010 to 69 perce Retirent an mentd is , Am now ong 68 Those perc Doi ent. ng a Ret 55 T% he perce iremntag ent Needs e of workers Calcul at ha ion ving s 74% aved for retirement Figure 5, Work saying they are very co actually er Confidence in Having Enou worked for nfident abo pay in retirement ut the future va gh Money to (23 percent P lue of ay fo r Medical Social ). Sec Expenses in Re urity benefits has gradu tirement10 ally decreased from Repo Worker rted O Confidenc ffer and e T ake- in Hav Up of ing Emp Enoug loyh Money er-Sponsor to ed first measured in 2009. report that their expected retirement10% age has increased. This means that 2 72 0% percent of all workers planned to educatio accumulate. n le vels rise or Forty-two Exp88 ected (W healt perc % ent of work h status im orkers) vers report pro s. A vc es. In tual Abou they (R additi t Sav etir gu ees) ing on, married workers are more likely tha essed at Sour and Inv ces the e s of tamount th ing Income in ey n Ree tirement ed to save, n t in hcluding ose not 10% 52% 12% 52 12% % 68% Retiree 70% Confidence 12% Figur in Hav e 2 ing Done 68% a 68% Go 12% od Job 70% and 26 percent in 2009 (Figure 13% 46). 2004 2006 5% 2009 2010 13% 5% 2011 Figure 42, Retirees Expectin 6% g Retirement Income 14% From Social S 16% ecurity an 51% d Defined Ben 14% efit Plans ........................................ 34 of the U.S. population. To 8%further 7% 66% T increas rend in e re Retir presentat ees’ Act ion, a c ual Retir ell em pho en nt A e su gppl e 66 emen % t was a 16% 17% dded to the sample. 21 perc expenses (up from ent in 2011 (F 7 percen igure 29). t in 20 07, but level with 68% the 12 percent in the 2010 RCS) and another 16 percent expectations about ho Less tw t hanh $1 ey, wil 000l transition from work to67% retirement in what 23% has been call 27% ed an age of “th 28% e increased from 1996 through 20 Ret 00, iredecl Pay ment i ned for 64 Sav % signi Medic ings Pl fican al Expen ans tly in , Am ses in 2001, ong Em an Repl tir d hover oy ement ed W ed aro orkerund 70 percent for most o s f a high of 28 percent in 2001 to just 1 66% 1 perc 8% ent in 2 66% 010 and 20 10% 66 11 %(Figure 45). 49% 81% Fi Figu gure re 9 12 Copyright Information: This report is copyrighted by the Employee Benefit Researc 13h % Institute 62% (EB 13% RI). It may be used postpone their retirement in 48201 % 1 (dow 48n % from 25 percent Figur 9% in e 26 2009 and 24 percent in 2010) (Figure 33). Figure 6, Work married to ha 11 percent o er Con f ve set mone those who fidence in report having Havin y aside. Wor g En Other ker ough of Prepa 16% Conf don M groups o o ein a c dence re ing Fina y to Pay for L alculat f iwor n Havi ncially ion kers more l . Twenty ng on fo Enough M g-term Care r Retirem i-one perc kely to have saved for oney t 13 eExpen nt % ent o ses in each Retiremen report askin retire tment incl ........................... g a financial ude . 10 Strongly Favor Somewhat Favor 11 Som % ewhat Oppose Strong 63% ly Oppose Don't Know/Refused 77% 77% 47% The 2011 Retirement Confidence Survey: Confidence Drops 59% 5% 13% ? The increase in the 76 percenta % ge of workers not at all confident about having 17 enou % 46 gh % money for a 61% Ve13 Th ry% e year So 18% befor mewha et you r No e30 ti t T re % od o N 3 o2% t At All 51% Don't Know/Refused Starting with the 200 17% 1 wave 17% of the RCS, all data are weighte 14% d by age, sex, and education to r 45% eflect the actual Figure 43, Expected (Workers indicat new normal. e they ” are not too co ) vs. Actu nfident al (Re (up tirees) Partic from 11 percent 14% ipation in in 2 Employer-Provided 007) (Figure 4). Retiree Health Insurance .................. 35 Workers N Reti ot ree Confi at All Confid dence in ent in H Hav av ing ing Enough Enough 16% Mo Money ney to Live the s ubsequent decade (F 16 ig %ure 14). The percentage of retirees havin 15% g saved for retirement climbed slowly 18% 16% Amount of SavingFi s gur W 12% or e 34 kers Think They Need without permission but citation 43% of L the ive Com sourfce is r ortabl 15% e y Thr quired. oughout Their Retirement Year 16% s Major Source Minor Source The large majority of Americans are conc 42% erned about possible decreases in Social Security and Medicare those advisor an age 45 and d doing t o 56 h lder % eir own (com estimate. pared with workers Others rea ad g or e 25–4 hear ho 4), those c w much urrently is needed (9 particip perce ating in nt), a use work-plac an onlie ne 42% Very Somewhat Not Too Not At All Don't Know/Ref 41 u% sed 19% Figure 7, Worker Confiden $1C ,0omfor 00 ce in - $ Doin 9,99 tably 9g a Good Throughout Job of Preparin 34% 45% Their Reg Fin tirement ancially for Re Years, by tiremen H17 ousehold t ....................................... 15Savings 19% 14 ............. 11 comfortable retirement appears to be largely due to a loss of confidence among those who have less proportions in the adult population. to Data Pay f for 26 or waves o % Medical f Ex th penses e RCS con 40 in % R de uct tire ed me be nt fore 2001 have been weighted to Trend i for Ret n Wio re rker mes’ n tExpe , by Hous cted ehol Retird ement Inco 33%m Ae ge 39% Figure 4 24% 6 26% from 52 percent in 1996 to 68 percent in 2006 and 20 Figure 4 07 and 4 now stands at 74 percent (up from 62 percent in Very Somewhat38% Not Too Not At All Don't K 20% now/Refused Figure 44, Wor to Record Lows, Reflecting “the New Normal” ker ConfidenceY That ou woul Social d prefer Security Will Co 1991 to look i 1996 nto in2001 vestm F ntinue to igur ent 2e 29 006 s Pro 20v 09 ide B 2010 enefits o 61% 2011 f at Least Equal Value to Benefits 16% 26% 37% 59% retirement sav calculator bene fits. Spe (7 percent cifically, ings plan ), they base t (co 9% Take r m ae loan 2 h pared with t port to eir 4 against estimate ybei ears befo ng their very h rose not e on thei money y or ou rsomewhat etir r curr parti ed e cipatin n 33 t ex concer %9%pe g), nses o thos ned t 22%e havi r lif hat the estyle 45ng atte % cost of (5 percent mpted a r Medicare 77% ), or etire fill pre ment savin out a miums wil gls 11% 31% 26% Percentage of Employed 31% 12% 15% Percentage o 32 f 15 % W % orkers Of56 fe% red 56% As referrthan ed to here, t $100,00 h0 e in savi “new norma ngs. Very T 15 l” refl So his pe % mewects the vari hrcenta atWork No erge incr s t Toooues forces c No 17% ased sh t At All arply amo ausing m D 30% on't Known any Ame /R g those wit efused37% ricans to 15h % savi 5%ngs less th delay retirem an ent: on your own W and m orker Confidenc ake your own deci e That sions Medicare Will Continue allow for consistent comparisW ons; consequ S oo rker Con cial Securif ty idence T ently, some da hat Socia ta in l Security the 201 1 W RCS ill Con may t34 inue % differ slightly with data Figure 8, Retiree Confidence in Having Enough Money to Pay for Basic Expenses in Retirement 68% 23 ............................................ % 91% 11 Recommen Received by Re ded Citation: R tirees uth Helma ToW day..................................................................................................... orker n, Cra Prog ig Co rin the plan ess i pela n Pl nd, ann and Jack ing and Va Sav nD ing erhei, for Ret “The irement 2011 Retirement Confi ............................ dence Survey: 36 2009) (Figure 15). 32% Workers Offered Plan 41% Plan Who 41% Contribute By Ruth Helm EBRI Employe an, e BMath enefit R ew G esearc reenwald h Institute Is& A sue B ssociates, an rief (IS Re StN ire 08 es87d ?1Craig Copeland and Jack 37X) is published monthly by the E Va mnDerh ployee Be ei, Employee nefit Research In Ben stitut ee, fit rise faster than in $1 flation 0,000 - (92 perc $24,999ent o 14% f workers and 86 12 percent 13 of r 409 % etirees), t 16hat Medicare 14 ben 12efits will be needs worksheet or calculat form (5 percen ion (compared with t) (Fi those gure 25). who have not), and those 14% who currently have a defined benefit plan 10% Very to Pr to Pr Someo o wh v vide ide at B B No e e17% n n t T e eo fits fits o of of No at Least Eq at Least Eq t A17% t All Don't ual V ual V Know a alue lue /Refused federal, state, and local government fiscal crises 39% 35% that are descri 10%bed as requiring permanent changes in $25,000 (up 44 fr % om 19 18% 17% p 37 19% ercent % in 20 19% 07 to 43 perc 20% ent in 2011) an 7% d between $25,000–$99,999 (up from published in previous waves of the RCS. 10% Data present Figur 13% ed e 4 in tables in this report may not total to 13% 100 due to 1100 13th St. NW, Suite 878, Washingt10% on19 , D 91 C 36 , 2 %00 1996 05-4051, 36 20 at % 01 $300 p 2006 er year or 20is 09includ 2e 010 d as pa20 rt 22% 11 of a m11% embership subscription. Periodi- Confidence Drops to Re20% cord Lows, Ref 35% lecti 10%ng ’the New Normal’,” EBRI37% Issue 22% Brief, no. 355 (Employ 23% ee Benefit Research 46% 35% 47%Figure 3350% 16% 26% 43% 2007 Workers 2008 46% 24 2009 % 2010 13% 45% 201153% 34% 77% Figu Research In re 9, Retire stitute e Con fiden 13% ce in Havin 12% 5 to g En 9 year ou 49% s befo gh Mro 18% en ye ou r y to Pay for M e 16% tired edical Expenses in Retirement ........................................ 12 Figure 45, Retiree Confidence That 6% Social Security Will Co 82% 45% ntinue to Pro 19% vide Benefits o 48% f at Least Equal 34% 81% 16% Value to Benefits You would pr 10 efer % suggestions from a 10% 17% 19% reduc (compar ed (88 percent of work ed with those who do not). ers and 87 41% to Benefits to Benefits percent of reti Receiv Receiv rees), an e ed b d by y R Rd that e etir tire ee es s S T T ooday oday cial Security payments will be reduced 47% All Workers Less t 32% h 13 a 3% n % $35,000 $35,000-$74,999 $75,000 or More 79% cals postage rate paid in Wa52 sh% ington, DC, and additio16% nal mailing offices. PO 14 S% TMAS 10% TER: Send ad 78 49% dr %ess changes to: EBRI Issue Brief, 1100 16% E W mor plo ker yme Conf nt idence in Having Enough Money 47% programs a 7 pn ercent d policies; in 2007 rising healt to 22 77% perc h car ent i e c n 2 osts with 011). 5% At no 17 the same time, the percentage not at clear 17 %% pat 22%h to control; lower interest rat 43% 41% all confident es and 17% Retirees 76% 16% rounding and/or missing categories. 10% Worke rs Expecting to Retire 12% Later Than Planned 22% professional, but often make your own 22% Institute, Marc h 2011). 6% 6% 2% Received by Re 38% tirees Today..................................................................................................... 28% 27 20 % 00 ............................ 36 $25,000 - $49,999 21% 16% 7371 % 4 13% 9%10 27% 18%9 13 11 27% 13%6 13th St. NW, Suite 878, Washington, DC, 20005-4051. Co 38% 72 py% right 2011 by Employee Benefit Resea 10% rch Institute. All rights reserved. No. 355 26% 26% 42% 71% 16% (87 percent of workers a W nithdr d 84 awperc any money ent o to 12% Pa at all f y 37% retirees f 44 6% or % until Basi 11% ). I c Expenses i n additio 10% nn , 76 Ret 12% per irement cent of work 70% 28% ers are concerned that the Figure 10, Retiree Confiden 11% 19% ce in Havin A lot 10% ahead g En of o43 u schedule gh % Money 2% to Pay for Long-term Care 25%Expenses in Retirement .......................... 12 15% Retirees 21% decisions 20% 49% 24% 35% 15% investment returns; longer life expect 19 ancie % s; later r 13% 12% etirement a 17% ges 27% for Social Secu41% rity 23% ; less job sec 14% urity; and remained low among t 35% hose with savin 38% gs of $100,000 50 or % more (5 19% 44% 11% perc17% ent, statistically 23% equivalent to the 22%24% 66% 10 to 19 22%years befor 35%22% e34% you 34% retired Figur 21% e 25 44% 23% 15%29% 73% 12% 12% 16% 3% they reach age 66 or leave their W j oo rker b18 s% Employ Veer ry-spon So sor me ewh d at 42% 37 No% t Too No17 t A % t All Don't Know/R 50 ef% used 23% Very 34% Somewhat Not Too Not At All Don't know/R22% efused 17% 21% Figure 14 Figure 46, Worker Confidence That Medicare 38%Will Continue to Pro 17% vide Benefits of at Least Equal Value to 45% Benefits Received by age at which they become 32% eligible st for Social Secu 2% rity re 24 ti% rement benefi 27% ts will 51% increase before they retire. 59% 23% 31% 18% 17% 10% 21% 44% 2001 27% In theory, the weighted 38% sample of 1,258 yields a Retirees statistical precision of plus or minus 3 percentage points (with Figure 11, Retiree Con fidence in reti Havin re31 m M e % e nt sa tg hod Done a G vings of Det plane ood Job o rmining Sav f Preparin ings 15% Need g Fina ed ncfially for Re or Retirem tiremen ent25% , t ........................................ 13 REC Report Ovarious other RD availa -LOW CONF 2 p bility: T ercent lID ong-t ENCE his re mea erm f :po Th sured rt, along w act e 2ors—includi 1in wave Ve 20 ry07 ith o 15% ). So seven re f the n mg, per ewh R atetireme h late aps mos Nod t T201 o nt Conf o 1 R t important NoC tide At S A Fact n llce She Survey lD y, on' the slow te Kts, is ava no(RCS w/R18% ef move used ) finds ilable ment of that Am on the the I en ricans’ co B ternet aby Boom at nfid ence 30 16% % 39% $50,000 - $99,99 17% 9 14 11 12 6 9 6 11 30% You w36% ould prefer su 30 ggesti % ons from 30% Workers Having Saved Money for Retirement 28% 38% 22% 24% Retirees Today ................................................................................................................ 41%18% 11% 41% 16% ................................... 37 35% 4% 35% 15% 12% 40% 17% by Workers Doi 34% ng a Retirement Needs Calculation 19% 20 year a pr s 42% ofes or msi or onal e befor and m e you ost re of tir 27% the ti ed me 29% 37% 43% 66% 23% 95 percent certainty) of what 33% the results would be if all Americans age 25 and older were surveyed with generation into the “senior” 26%years, whic 27% h willW take t orker 26% s 3%he Figure 16 26% proportion o 26% f the population over the age of 65 from in th www.ebr eir ab i.org ility Th to affor e RCd S a IFact ndi co vimfortable dual Sheets cover retirem reti ent ac re such topics count ment 24% has plu as chan nge 38% d to gin a n 25% g expectations a ew low at the sa bou me time t retirem that t ent, a hg e re e, a cent nd ge de nde clines in r, and 32% 7% 38% 31% 26% 14% 7% Figure 12, Workers Not at All Confident in Having Eno 23% ugh Money to Live Comfortably Thro 23% ugho 2002 ut Their 22% Retirement Years, 21% 21% 42% 40% The Employee Benefit Research Institute (EBRI) was founded in 1978. Its 20% mission is to Nine in 10 workers offered a 37% Tn ak em e earployer-s lyuse their distr 6%ib5% utions ponsored r recom for m endat e17 itire on % sment savin 31% gs plan 48% say they 25% would find statements that ? Retiree conf 5% idence A 6% little ahead in having of sche a financ dule (mult ially s iple r 5% 3%e es cure ponses retirem acce ent is stabl pt 7% ed) e, with 141% 7 percent saying they are 31% NA NA Retirees 8% 5% NA 9% NA NA 10% or IRA 24% 4% 9% 24% Figure 47, Retiree Confidence That 24% Medicare 24% Will Co 11% ntinue to Pro 11%vide Benefits o 46% f at Least 11%Equal Value to 4% 12% Benefits Received by 3% Work 45% ers 25% Currently Sa 20 v % ing Money for R 43% etirem 37% ent 12% 3% complete accuracy. There a 29%re other possi 26% 18% ble sources of 19% 26% error in all surveys, however 26% , that may be more $100,000 - $249,999 19 40% 13 4% 20 13 10 15 12 other ret are avail under a by Hou ireme bl 14 perc e ont conf nline sehent today to o ol at d S ide ww a 25% n vin ce w. g ebri.or s indicators educati .......................................................................................................... ver 21 percent on, home g/surve appear to 30% purchases, ys/rcs R before the last Boomer espon /20 be or dent stabi 1 16 1/ % 9% R liz esp 28% in 16 onde g. % Instea nt 2 42% an 8% d/or43% Spo 31 15 d of retir % % use makin e29% s. g fundament 38% al a 6%d ............................... justments to their 14 1998 26% 1419 %99 2031% 00 20 23% 01 28% 2002 28 36% % 2003 2004 30% 2011 contribute to 38% 32% 22% , to encourag 32% If y e, an 38% es d to enhance the development of sound employee benefit 47 10% % 40% 35% 34% 12% 34% 33% 10 55% % 38% 11% 44% 44 32% % 34% 9% 9% 12% 21% 8% 40% 11% 37% 8% 39% 37% estimate ho Retirees not at a w To much th day ................................................................................................................ ll confey sh ident 38% (statistic ould saveally e so tWorker h qat they uivals R ent can to the 1 6% maintain 89% per their cent me currentetirees asure 21% lifdestyle in in 20 7% 10 retir ) an 39% ................................... d 2 emen 4 perc t (9ent v 1 pere -ry 38 37% 5% 45% 26% 39% 37% 65% 41%medical expenses D W oo n’ rker t know s 5% 42% 2005 Other personal Soc sav ial iS n 37% e gc suri and ty 36% 39% Employer-spons 12% ored traditional pension Who we are 12% 20% 31% 10% 24% 34% 11% serious than theoretical calc 41% ulations of programs and so 37% 23 sa % mplin und public policy g error. These through objective inclu 13% de refusals to 43% resear be ch and intervie educati we on. EBR d and oth I is the only er 19% You would pr19 efer % a professional to 14% 13% spending and saving pattern 1993 s in res 1996 2001 ponse t 2002 o the 2003 decline 2004 in 2005 confidence, 2006 2007 workers conti 2008 2009 nue to 2010 37% cha 2011 36% nge their expectations Workers 22% 19% 31% Retiree 50s % 1998 2001 2002 2003 2004 2005 2006 2 22% 007 2008 42% 2009 2010 216% 011 Figure 13, Workers Not at All Confident in 18% 37% Having Eno Retir uees gh 37% Money to Live Comfo or 38% car stably Thro h balance 46% plan ughout Their Retirement Years, *In 1998-2004, the do inv llaest r 35 am % m oents unt cited in the question was $20. 38% 41% cent), how much retir 32%ement 34% income they c 20%ould expect from the money they c 41% 20u % rrently have in their account confident (stat 1992 istically e 1996 20q 01uiva 20 lent to 02 200 the 3 1 209 04 perce 2005nt in 200 2 60120 0). 07 2008 2009 2010 2011 1991 1996 2001 2006 2007 2008 2009 2010 42% 2011 privat ma 19 nage y %e, nonprof our investm it, nonpar ents for tisan you 11% , Washington, DC-b 11% ased organization committed exclusively to Figure 48, Con As evidence o cerns f this Regarding S $250 propositi ,000 or ocial S m on, Fi oreegur curity e 1 s an 15 h d M ows a Guess edi2 care .................................................................... co 1 mparison of 14 28% avera 12 33% ge co 12 nfidence12 in havi 36%ng eno 17 .......................... ugh money 38 17% 16% 26% forms of nonrespons 19% e, the effects 78 of qu % estion wordin 14% g and qu 14% estion order, 25% and screening. While attempts are 25% about how they will transition from work to retirem 16% ent in what has 12% been called an age o 20f 11 “the new normal.” by Age ........................................................................................................................ 16% ....................................... 14 24% 75% 67% Source: Employee Benefit Researc On tr h Ins ack titute and Mathew Greenwald & Assoc 34% iates, Inc., 1993-2011 Retirement 15% 17% 2912% % 12% 26% 56% Source: Employee Benefit Research Insti72% tute Wo and rkers Mathew Greenwald & Associates, Inc., 72%1993-2011 Wo Retir rem keent rs (91 percent), and Ehow S m ou pl rcoy e muc : er Em -spo ploy h retir n ee spublic or Bee ne d e fi tr ment t R poli ad esi etarc ional ichy r n In come th 41% ste its uearch te an 71% d Mey c aand thewo Gedu uld reencat wex a42% ld & ion on pect Assocfr iaecon om the mo tes, Inco .,m 112% 99 ic s 3-201 ecuri ney 1 Rett in t iy re ma end em nt he plaplo n iy f ee they conti benefit is nue sues . S Source: ource: E Em mpl plo oy yee ee B Benefi enefit t R Re esearch Insti search Instit tut ute and e and M Ma athew thew Greenw Greenwal ald & d & Associ Associates, Inc. ates, Inc., , 1993-201 1993-2011 1 R Re eti tirem rement ent 13% 38% 11% 70% 39% 13% 69% 69% 37% 69% for a comfortable retirem SConf ource: idenc Em e S pl eo nt urv yee ey for workers r B s.enefi 35%t Research Insti espondi tute and M ng to athew Greenw the 2010 RCS vs. ald & Associates, Inc., this 1993-201 year’s workers. The average 1 Retirement The 2010 Retirement Confidence 35% Survey 36% was underwritt 35% 30% e 12n by %20% 26 organi 51% zations, liste 68% d on pg. 4. made to ? mini Worker mize t confi S S ource: ource: hese dence Em Emfac pl 33% ployee oyee tin ot ors, it is im B B ene ene her fi fit t R R e f e search In search In inancial possible to sti stitt ute and ute and aspe M Mc a aqua tt thew hew s of reti 68 % Greenw n Greenw tify the errors re al ald d & me 21% & A A ssoci ssoci nt appears to ates, ates, t Inc., Inc., hat may r 1993-201 1993-201 65% have stabi 1 1 e R Rsult e e ti tirem rem from t ent ent lized h em. below the levels S C ource: onfi C 32% ond fie dn en E cm e c S e pl 42% S u o M rveys. u yr ee ake a vey B s enefi 31% . har t R d esh search Insti 46% ip withdr tut R aw e and etir aees l35% M8% athew Greenw 19% ald & Associ 25% ates, Inc., 1993-201 35% 42 1 R R % et etii rem rees ent 31% 6% 21% pension or cash balance plan 21% 64% 42% 20% 11 66 % 64% % 30% C Confi onfi 43% dence S dence Su urveys. rveys. 20% 20% 47% 33% 20% 19% 11% 28% 20% 44% 18% EBRI’s member 40% 18% ship includes a cross-section of 21% 47% 33 8% %10%18% pension funds; businesses; trade associations 8% 8% ; 36% 35% 26% Figure 14, Workers Havin Confi g dence S Saved M urveys. on 33% 41% ey 62% for Retiremen 35% t 62% 31% .......................................................................... 12% 10% 35% .......................... 15 to save at their current rate C C onfi onfi denc denc e S e S u u rveys. rveys. (89 percent) t Ask a financial adv 38% o be very or isor s 42% omewhat 2% 27% valuable. 7% 45% 39% 13% 7% 10% Source: E 61 m% ployee 6 B1% enefit Research Insti45% tute and Mathew 25 Gr% eenwal33% d & Associates, Inc., 1993-2011 R 8% et12% ire 8% me8% nt 12% 7% Confi 45% dence Surveys. 2318% % 24% 24% 60% 60% 22% 9% 9%9% confidence was plotted agai 9%nst the 9% empirD ical age-specif on’t kno 21% w/Refused 33% ic retirem 7% 7% e34% nt preparedn 6% 6% ess for each 6% of four quart iles. WORKERS NOT CONFIDENT: The percentage 1993 19% 1994of workers 2004 not at all 6% c20 onf 05iden 9% t abou 2010 t ha28% ving en2011 ou59 gh 36% % 9% money for a comfortable Financi 18% al products outside of 58% a 7% 18% 5% 6% 46% 33% 5% 6% measured in 2007. Twe labor un nty-eight ions; h p ee alth rcent car e prov of work iders and insur ers report they a ers; government org re very conf 9% 16% anizations; ide31% nt that they and service firms. will have 14% 42% 25 31 % % 41% 45 5% % Confidence Surveys. Workers 13% 34% 13% 49% 13% 43% 8% 7% 7%7% 37% 36% 38% 15% 35% 36% 40% 7% 7% 34% 2 retirement plan that 32% provide 26% 30% 14% 12% 18 2% % 30% 3% Figure 15, Retirees Having Sa The RCS was co-sponsored ved Money 29% by the Employ for Retirement ee Bene ..................................................................................................... fit Res earch Institute (EBRI), a priv 6% ate, nonprofit, 15 5% 21% retirement grew from Workers i Retirement Savings n the first 22 qua perrtile cent in 2010 t A had the little behind loo west degree of a sch 27 percent, edule Retirees the ctual highest le preparedness, 1996 vel measur 2001 2006 whereas 20 ed i 09 n201 the 0 those in the 2 21 011 yea 27%rs of t fourth he RCS. At the 1993 1996 1996 2001 2 2001 006 20 2002 09 201 2003 0 2011 2004 2005 2006 1% 2007 2008 2009 25% 2010 2011 5% enough money to pay for basic expenses during retire 25m %ent (statistically equ 23% ivalent to the 29 percent Source: Employee Benefit Research Institute and Mathew Gree nwald & Associates, Inc., 1993-2011 Retirement guaranteed income for life Do your own estimate 43% 3% Sourc 1993 e: Em1996 ployee B2001 enefit Res2002 earch Ins2003 titute and M 2004 athew Gre 2005 enwal2006 d & Assoc 2007 iates, Inc2008 ., 1993-201 2009 1 Reti3% rem 2010 ent 2011 1993 1996 2001 2002 2003 2004 2005 200 23% 6 2007 2008 2% 2009 2010 2011 Confidence Surveys. 2%2% 4% nonpartisan public policy research organization, and Mathew Greenwald & Associates, Inc., a Washington, DC- quartile had the highest. In general, if workers whose actual preparedness was below where they should be at same time, th Figure 16, Wor Retireme e percentage kers Cu nt Confidence rren Confidenc tly very e S Saurv vin ey confident g s. M EBRI’s work advances knowledge and unders oney shrank to for Retiremen the low of t ...................................................................... 13 percent thattanding of emplo was first measured in yee benefits and their .......................... 2009. 16 A sizable percentage of workers have virtually no money in saving s and investments. Among RCS workers Retirees ten measured d to ex in press hi 2010,gher l but still evels o down f co from nfidence 40 perce thannt in worke 20rs abo 0 30% 7), 12 ut eac percent h of are v these fina ery con ncial fident aspects of about b eing Source: Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc., 1993-2011 Retirement Under $250,000 $250,000- $500,000- $1,000,000- $1,500,000 or Don't Source: Employee B32% enefit Research Institute and Mathew Greenwald & Associates, Inc., 1993-2011 NA Retirement Source: Bef E o m rpl e 6 oy0 ee Benefi 26% 74 t % Research Insti 60-64 tute and 28% 31% Mathew30% Greenw 65 ald & Associates, Inc. 66-69 , 1993-2011 Re7 tirem 0 or ent older 34% 9% 30% 33% 26% 23% Confidence Simportance to urveys. the nation’s econo Figure 39 my 27% 29 % among policy 24% makers, 26% the news media, and the public. It based market research firm. The 2011 R 25% 28% CS data 68% collection was funded by gr 30% ants from more than 23% 29% two dozen Source: Employee Benefit $ R499 esearch Insti ,999 67% tute and $999 M,a 99 thew 9 Gr eenw $1 al ,49 d & 9 A ,99 ssoci 9 ates, Inc., mo 1993-201 re 1 Reknow tirement /Don't their age became more realistic with respect to thei Conf 27% idence Surveys. 65% r confidence29% levels, one would expect to 24% observe a providi Like retir ng this ees, stype o ome worke S Cource: onfi 1993 f dence S in Eform m1996 plrs u o rveys. yee are lik ation, 5 B2001 enefit ely to Re6 search Insti 2002 perc find t ent re 2003 tute and hemselves port t 2004 Mathewh 2005 Greenw a 10 t vulner the tota % al 2006 d & Associ abll val 2007 e to ates, Inc. uan un e of 2008 21% , 1993-201 th pla eir 2009 nne 1 household’s savi Red ti2010 rem early ret ent 2011 25% ireme ngs an nt. The d able to pay for Read or medi hear cal that is ex how m penses (l uch nee evel dedwith the 12 percent measured in 2010, but down from 20 per- Financial Advice retirement, and thS e 2011 RC ource: Employ60% ee S shows l Benefit Researc ittl h I e nsc th ituta e a nge nd M fr athe ow m Gree thnw e le ald ve & Alss s measu ociates, Inc.r , e 1993-20 d for 11 re Ret tiire reme ent s i n 2009 and 2010. Figure 17, Workers Who Think It Reasonabl Savi 40% ngs <$25,000y Possible to Save $25 a W Savings $25,000-$99,999 eek for Reti 40% rement ......................................... Savings $100,000+ .......... 17 Moreover, among workers 26% 38% 57% who do not 38% expect to receive retiree health insurance from an employer, many do Overall Retirement Con Confidence Surveys. fidence 37% 36% 34% Befo17% 20% re 60 does this b Reaso 60-64nys co fonducting r Wo 65 rking and p 35% for ublishing policy re P6 a 35% 6- y 69 in Retiremen 70 or olsear tder , ch, analysis, Never retireand special reports on Confidence Surveys. 8% 34% remember These fin dings are similar to some other estimates of Am 33% erican household financial assets. Quantifiable data INCOM What we do E BREAKS: The i Sn our Conf cre ce idenc : ase Em e S ployee iur nv th ey B se pe enefit R . rcen eseartag ch Inse titute of w and M orke athew rs Gnot at r eenwald all & A c ssoo cnfident iates, Inc., 1993- about 2011 havin Retirement g enough money for a A lot behind schedule Figure 21 29% Table of Contents public and private organizations, with staff time donated by EBRI a 33% nd Greenwald. RCS materia 28% ls a nd a list of significantly lower average confidence in 2011 compared with the 2010 level. That is indeed what is observed 25% investments, e consequences can xclud be ing heavy the v.alue o Retirees f their wh p o retire rimary home earlier than and a pla ny defi nned neare more likely than t d benefit plans, is less than hose who r $25,e 00 tire on 0. After decre cent i asing n 2007), from 48 9 perc percent i ent are very con n 2007 to 34 fiden percent t abou in 2 t bein 008, g the able p to ercenta pay for ge o long-term f retirees v car ee ry co expe nfid nses ent in Confidence Surveys. 8% 8% emplo Am yee benef ong Ret 7% its issues; holding educational br irees 7% Who W 7% orked for7% Pay: 20 iefings for EBRI memb 10 7% ers, congressional and not appear to be taking health costs suffic 6% iently into account 6% when 32% estimating 5% 6% how much th 5% ey will need for Almost one-quarter of workers and retirees (23 7% perc 6% ent 7% each) report 6% they have obtained investment advice Figure 18, Total Saving Ss an ource: 3%d In Empl 3% vestmen oyee Benefits Reported t Research Insti 5% 5% tutby Wor e and Mathew kers, Amon Greenwal5% d &g Th Associose ates, Inc. Providin , 1993-201 5% g a 1 RRespon etirem 5%ent se ................................ 5% .. 17 Source: Employee Benefit ResA earc ssessment h Institute and M o atf hew Gree F Cur igure 48 rent nwal Lev d & Asel soc of iates Debt , Inc4% ., 1993-20 11 Retirement from the As Americans 2007slowly adjust t Survey of Consumer o a number Finan of realitie ces (conduct s that ed by t will affect t he U.S. h F eiedera r retirem l Res ent, t erve Boar heir co d) nfi fo dun enc d that e in their the comfortable retirement appears to be largely due to a loss of confidence among those who have less th an $100,000 in Introdu under ction writ .................................................................................................................. ers may be accessed U at se a the EBRI n online calculat Web site: or www.ebr 14% i.org/rcs/20 40% 11/ ................................................... 5 for the first quartile i Sourc n e: Figure 1 (an Employee Benefit avera Research g Ins e of 2.25 titute and Mathew in 201 Greenw 0al d d & ropp Associing ates to 2 , Inc., 1993- .11 2 in 011 2 Re0 tir11) ement. Howe ver those who This i time or later ncludes to say they 29 perc Confidence S ent are not confident wh urveys. o say they federal agen hav cye about s less tha taff, and th havi nng e news $1enough money for a ,000 media; in savings (up from and sponsoring public opinion survey comfor 20 table retirem percent in 20 e0 nt or ab s on emplo 9, but out y ee (statistically equivalent to Sour Conf ce: idenc Eme S plourv yee ey B s ene . fit the 10 Research Insti percent tute and Mfound athew Greenw in 20 ald 10, & Associ but belo ates, Inc., w 1993- th201 e 17 perc 1 Retiremen ent t measured in 2007), having enough money 2011 Retirement C to pay for basic expenses contin onfidence ues steady at Survey Underwriters 35 percent in 2011. At the same time, 2002 2005 2008 1% 2009 2010 2011 retirement. Thirty-thre 1992 e 1996 percent of 2001 work 2002 er2003 s who 2004 do not 2005 expect em 2006 2007 ployer-provi 2008 2009 ded he 2010 alth insur 2011 ance in from The RCS a professional finan provides little sucial advisor pport for s Concer pwho was ecula ns Rtion that egar pai ding Social d work throug ers who h f Sec ees or u do rity commissions. Tho a r and etirement Medicare savings calc se with hi ulatio ghen r are levels of Employer-sponsored r Confi 1992e den tire c1996 e Sment savin urveys2 .001 2002 gs plans may 2003 2004 be 2005 among t 2006 he mo 2007st eff 2008 ective v 2009 ehicles avai 2010 2011lable for median ability to (m retir idpoint) e comfortably c level of ho ousehold fi ntinues to nan falcial assets l. More tha of n t one-quarter he American of h workers ouseholds (2hav 7 percent ing these ) in assets was the 2011 RCS savings. This percenConfi tage den in ce S creased sharpl urveys. y among those with savings less than $25,000 (up from 19 percent in 2007 Figure 19, Total Savings and Investments Re benefit issues. ported EBRI’s Ed by Retirees, Amon ucation and Re g Those P searcrovidin h Fund g a Respon (EBRI-ERF) performs se ................................... the charitable, 18 Retiremen whose a t Co gn ef- iden specific ce ......................................................................................................... pr 1993 epar 19 e96 dness is r 2001 e 2002 latively hi 2003 gh 2004 (i.e M., aj 2005 othose in the r Reas 2006 on 2007 M fourth inor 2008 Reaquartile) son 2009 2010 woul ............................................. 7 2011 d not be expected to 5% statistically equivalent paying for basic expens to the es, medical 27 pe e rcent xpe m nses easured in , and long 2010). -term care Appro ex xp im ens ates ely 1 i . n 10 each report totals of 8 percent and cont 22 percen inue to be t are v not at all ery con con fident fiden they t abo are doin ut payin g g a for good job basic exof pre penses pari (statistically u ng financially nchan for retirem ged from ent 3 This survey was made possible by the F fina igur ncial su e 42 pport of the following organizations: retirement believe th Sourc ey n e: Emeed to accum ployee Benefit Researc ulat h Ins et a tota itute and Ml of athew Greenwal less than d & A$250,000 ssociates, Inc., for r 1993-201 etirem 1 Retirem ent, an ent d an additional financi discouraged by the r al assets are more Source: esults. Em lik ployely than ee Those Benefit Rwho e those search Insti ha with ve don tute and loe wer M a athew re lev Greenw ti rement nee els of assets to seek this ald & Associates, Inc. ds calculation , 1993-2011 R advice, but co etirem ntinue ent to be whet more her th like is is ly encouraging workers t Based on o save cur fo rr r ent e expenses/lifes tirement. W tyle hile 1% the RCS does not distinguish how much money is saved in 1994 1996educa 2000tiona 2001l, and 2002 scientif 2003 2ic func 004 20 05 tions of the Instit 2006 2007 2008ute. EBRI 2009 2010 -ERF 2011 is a tax-exempt organization $25, say they are not at all confident that 300. they will have enou gh money to live comfortably throughout their to 43 percent in 2011) and between $25,000–$99,999 (up from 7 percent in 2007 to 22 percent in 2011). Expected sources Sof income ource: Employee in Benefi reti t rement Research Insti among worker tute and Mathew Green s, and actual wald & Associates, Inc., sources of retir 1993-2011 Retirem eement nt income among Confidence Surveys. Figure 32 have much of a di Cffer onfidence S ence u betwee rveys. n the 2010 and 2011 8% l evels (which is precisely what is observed in Figure 1 Figu Overall Retiremen re 20, American $25, 000–$49,999 s Reportin t Con (11 fiden perce g T ce ................................................................................................. h nt), ey Dipped $50,000– into S $99, avin 99g 9 s to Pay (9 percent), for Basic $100, Ex0 pen 00– ses ............................................. $249,999 (14 perc ...................................... 7 ent), and $250,0 .............. 00 19 (statistically unchanged fro Ret mi 21 rees Expect percent i ing n 2Ret 010, iremen but dto wn Income from All W F26 r oom rker perce s nt in 2007). 9 percent in 2009S an ource: d 7 Emper ployee cent i Benefin 2 t Research Insti 010) (Fi tut g e and ure 8 Ma) thew . Figure Greenw 24 ald & Associates, Inc., 1993-2011 Re69% tirement Endnotes 17 percent think they will need supported b $250,000 y– co $49 ntributions 9,999. An and g Employee rants. Benefit Research Institute study finds that a becaus Overconfid than those who have not to e higheence? r-as Confi s We at in dence S nting divid to s urveys tuals say they ar ay . activ fee el and a inv gre e v olv e ary conf ter n ed eed 2005 ident about having enough for i nves 60 2011 t % ment advice or money for a comfortable beca 32% use prof92 es% sional advice each type of savings ve Source: Ehicle, mployee workers Benefit Researc who h Ins tcurrently itute and Mathew Gre parti enwal cipate in d & Assoc this t iates, Inc y.pe o , 1993-201 f plan 1 Reti ar rement e more than t wice as retirement years. This represents an increase of 5 perce Vntage ery conce poi rnednts S fr omom the ewhat concer 22 ne p d ercent measured in 2010 Confidence S V ua rveys. lue of Various Account Statements if Provided as Part of Retirement Working for Pa retirees, have changed y in slight Retirement ly over time. Although vi 5% rtu ally all retirees Di continu d Calculate to ion report receiving income Social Security and Defined Benefit Plans as both years have an average fourth quartile confidence of 2.91). Confidenc Source e Surv : Eey mpl s.oyW ee B o enefi rker t Res searc Ha h Ins vitng T itute and ried Mathew to C Greena wlculate ald & Associates Ho , Inc w., Much 1993-2011 R Money etirement or more Aon Hewitt (10 percent) (Figur e 18). R etirees provide similar estimates of MFS Investme total hous nt Manaehold geme saving nt s (F igure 19). Confidence in Other Financial Aspects of Retirement ........................................................................................................ 9 Fill out a worksheet or form 10% Figure 21, Assessment of Current Level of Debt ................................................................................................................. 19 Older man w workers ith median tend drug e to report xpenditur higher es wo amoun uld n ts of assets. eed $65,00 Seventy-o 0 in savings n a e percent nd a woma of wo n would n rke 57% rs ag ee 25 ed $–3 93,0 4 h 0a 0ve total if they RETIincreases th retireme REES: Reti nt ree co (20 e li perc kelihood of nfident vs. ence in buildi 8 havin perce ng asset le gn a t). fi In nancially avels is un dditio secu n, those clea re retir r. who th ement ink t is stable, he Dy id nee Not D with d o to C a17 acc lculaperc tu iomulate n ent sa at l ying t eashey ar t $1 me illion not at likely as those who doC not t onfideSav nco e S report urvey ings Plan, s. savin Ag m s an ong d inv Worke estm rs O ents of ffere at l d an east $50, Employ00 er-Spo 0 (52 p nsored ercent Plan vs. 23 percent). 1 ? Sixty-eight percent of workers report they and/or Figure 3 their spouse have saved for retirement (down from One and is the possible highest leve explanation l ev fo err the measure contin d i uin n tg he decrease 21 years Fig in uof the RCS. re 6 overall retirem Ano ether nt con 23 fidence among work percent are not tooers is that confident <.5% The retirem from Social S en et age reported by r curity, the percentage of wo e They tirees ha Need rkers expect s changed even to Save for ina Comfortab g in more slowly. come from le this source Retirem In 1991, only ent has decl 19 percent ined fro o m f retir 88 per- ees In the RCS, retiree refers to individuals who are retired or who ar Enjoying working Figure 36 59% e age 65 or older and not employed full time. 28% 86% The RCS has consistently found that workers are Workfar mor ersFigure e 27 likely to expect to work for pay in r 92%etirement than EBRI Issue Briefs is a monthly periodical 65% with in-depth evalu 27 at% ion of employee benefit issues Figure 13 Overconfidence? ............................................................................................................... The cost of Medicare premiums will Figure 18 ........................................... 13 want an average (50 percent) cRetiree Confidence hance of having eno in ugHav h money to cove ing Enough Money r health to care expenses in retirement. savings an in retirement d i s nv avings ar estments of 200e alm 1 l2002 eo ss than st five tim 2003 $25,000, e2s 004 as likely as compar 2005 th e 2006 dose who with 2007 46 p think e2rc 008 ent of they 20 work 09 need201 ers age les 0s than 201 415$2 an 50,0 d ol00 to der. At th be e all con American E Furthermore, fident and 24 xprworkers are m ess percent veryo confi re likely to r Wod rker Confidence in ent (statistically eport they ha eq Hav uivale ve money ing n Nation t to Enough 2 in a wid 010 ne M leve employer oney ls). to -sponsored retirement savings Figure 22, Reported Offer an 75 percent in 2009, but d Take-Up of Employer-S statistically 1991 199 equivalent 6 pon 2001 sor Fed Retiremen igure 10 to 2006 the 69 200 perce 9t Savin 2010 nt meas gs Plan 2011 ured in s, Amon 20 g Emplo 10). Fifty-nin yed Workers e .......... 20 workers are becoming more realistic they will have enough mon Comparison ey, making hal of Expec abou ted ft their of a (Wll or prospec work keFigure 8 F rs iers gure 45 ) and t not too s for a Actual (Retir fin or not ancially comforta at all con ees) Retir fide emen ble ret nt of t A havin ige rement g egiven nough their Worker refers to all individuals who are not defined as retirees, regardless of employment status. said th cent 199 ey retir 1 to 7 e7 d at pe ag rcent e 65 in Wo o 2 rk r 011. later. er C oThe n fid This p en ec rc pe eentag rcenta in Abe ility of ge wor rea to A ck hed cers ex cumu 32pectin la perce te Sa g nt in v to rec ing 2 s 010, N ee ive ed b be eu dt has ret nefits for from a urned defi to 2 ne 5 d per- rise fast and trends er than infla , astion well as critical analyses of employee benefit policies and proposals. EBRI retirees are to have actually worked. The percentage of workers planning to work for pay in retirement now Our Workers No 41% t at All CoFi nfident gure 1in Having Enough Money to Live Despite increased efforts to iLiv ntroduce e Comfortably financial R Throughout products t etirees hat work Their Reti 60% witrement hout dirY eears ct i27 nve % stor managem 86% ent, such Total Savings and40% In 96% vestments Reported by Workers, Pay 39% for A statem Longe -term Care Expens nt under certain assumes ptions in Reti about how rement much… Preparin same time, For a g for higher Retiremen 17 (90 perc perc St ourc ...................................................................................................... ent o ent) ch e: E Wm f a ntin pl wo oyeance o g rkers age e Retire money Benef Retiree Con Retiree Confidenc it Res f e to h Confid earc b a 4 uy vin 5 h extr a Ins g e n tience ta ut d ol fnoug se and idence i der Tha Mh, a at 21% e cite hew in t Social Security n m GHav Hav a reenwal assets of $250, n wo ing ing d &uld Enough A Enoug ss ne ocia 51% tes e d h ,W I $ nc 000 Money Money ill Contin .1 , 1993-201 2 or mor 4,0 00 to 1 Ret 72 ue an e % irem d a (versus 3 ........................................... 14 ent woman perc $152,0 ent of 00. A very confident (33 percent vs. 7 percent). Finally, those who name a goal of under $250,000 are almost twice plan with a current or previous employer (59 perc 37%ent) than to say they have an individual retirement account The likelipercent hood of f say eelith ng a lot ey Ret an ird/or e be mehin nthei t,d sche Ar mspouse are ong 92% dule is Those Doi inver currently sel ng a y relate Ret savi irn e d to g m (do ent h o w Needs Cal usehold inco n from 65 perc culm ate, house ion ent in 2009, but hold assets, money for current level reti orement. f retirement On pr theparatio e oth Notes er h is a monthly ns. and, 13 This is suppor percent periodical pr ated re very oviding curr by the fact confident in ent th that the incr formation on a variety ey will h eave eno ase in th ue gh of emplo perc moentage of ney to yee ben live efit 91Comfo % rtably Through 91% out Their Retirement Years, by Age Figure 23, Favor/Oppose Ch cent i bene Again, The dec fit n th worker pla lines e n h 20 in a 11 confidence worke s als RCS o de r con (Figur an crea ges to th afb ie 3 d sout the ed s enc 5). e e Ru li a gThe htly fut bout les Rega m ufro re h e aving dian m value o 61 rdin (midpo p enou g Retiremen ercent f Me gh int) a di c money to in 2 are bene g006 te at Sa to viwhich retir n fits is pay g 56 s Plan perce for me higher s, Amo nt in ees r dical among those a n 2 e g Workers ex port they re 011. At penses a the same time, ................................ n g tired has d lo e 45 ng-t and o erm l the der, .. 21 Confidence Surveys. AARP Respondent Respondent Natixis and/or Glo Spous bal e Associates stands at 74 percent (up from 70 percent in 2010), compared with just 23 percent of retirees who report they 2 Averag 87 A% m e Co ong T nfid h eo ns ce e Pr In ov Havi iding ng En a ou Re gh sp M on oney se SAVED FOR as managed f RETIREMENT unds a ? S nd ann i86 xt% y-euity optio ight pPa erto Prov c to Pay yent n for s wi o Lon f thin id for we o g-ter r B Benefits def kasi erm ine s re c Expens Car d c p o of e o r Expen tntributio th at Lea es ey and in ses st Equal n R e /pla o in tirr t e n Rh ment s, workers a e V e tir ir sp ae lue ment ouse h na d r ve sa etire ved es say they for retiremen prefer t couple both with median drug expenses would need $158,000 for a 50 percent chance of having enough workers a as likely as Actual prepare g th e 25–34). ose who dness is proxied by the ratio of: (1) the As o name ne might suspect, total sa a topics. EBRI’s goal of $1 million or Pension Inv mor vin midpoint of the range of current s g e ess an tme to feel nt Re d inv a lot estments incr port behi provides detailed nd schedu ease sharply w le in afinanc vings divided planni iali inform th ng househol and savin by the ation on d g th e Saor IRA Among th ving for (inc Re e r tiremen ludi easons given ng a t ......................................................................................................... rollover fo Ir the chan RA) (45 perc ge by work ent). ers postponing retirement in the 2011 ......................................... 15 RCS are: health status, statistically equivalent and Source: education Employee . Among oth Benefi to the t Research Insti perceenta rs more lik tute and ges Mameasured in thew ely Greenw to descri Veal ryd & va A lu o s asoci btbe le her years ates, Inc., thSemselves as a ome1993-201 w). h27% a t valu 1 a R be le tirem lot ent behind schedule are workers not comfortably publications in at retirem all confi ed nt ent (e about quivale havin nt tog the low of 13 enough mone percent measur y for a comfortable retirem ed in 2009), and ent appears to 36 percen t are be largely th e Very Somewhat Not Too Not At All Don't Know/Refused remaine percentage of and r care e ex tirees ar penses d at ag in r retirees r e more likely e 62 etirem throu ee port g nt h t o also appear to ing t Ver h ut this tim an y worker hey So a mc ee tua wh s t . at o have lly rece beNo conf halte t T ive suc oident o d. The No .h Even bene t At Al per l fits has so, the perc centa Don'tg K decr e now s of workers who /R eased fro enta efused ge ofm retire 62 percent ar es very e very confid to 51 confident per- ent in A job opportunity 26% 38% 24% 63% Workers Retirees Figure 24, Wor worked for k pa ers Havin y in reg tirem Tried to Calcu ent (Figure late How M to B 38).e nefits uch R M ece oniv ey Th ed by ey Need to S Retirees Ta oday ve for a Comfortable Retirement ................ 21 (not including 22% value of primary residence or defined benefit plans) a hands-on approach to Confi fo dence S r a man C urvo eys. mf agin org tab their sa le Revings an tirement, d inv bye Qu stments artile . Whe * of An as ge-s ked pe abo cific ut their preferred approach (down from 75 percent in 2009, but universe of def statistically e ined benef quivaleF nit, d it to th gure 15 efined e 201 contr 0 level ibution ). , and 401(k) plans. EBRI Fifty-nine perc88% ent say they a Fundamentals of nd/or their 20% Workers 60% 27% midpoint of the range of curre income, Bank of money, an for retir Ameri eeduc ment d $a 271, ct(50 percent vs. 27 percent a/Merril ion, an 000 for d h l Lync e a alt 90 h nt income h status. percent c divided by (2) the p Wor h)ance. . kers who At th have e high redicted saving don eNew York st (90th e a retir perce Life ement savin s/income ratio Retirement P ntile) lev gs el of needs needed to produce a l dr an Serv ug calcul spe ices ndin ation g, a man Retiremen single workers t Saving (com s ............................................................................................................ pared with married workers), those who have not saved for retirement .......................................... 17 (compared with somewhat co result of loss o nffide con nt. fidence Overal am l retir ong those ement co wh nfidence o have less t amoh nan g workers h $100,000a s fluctuat in savings. ed o Th vis perc er the 2 entage i 1 years of th ncreased e the valu cent (Fi about bei g e o ur ng es 41 f th abe f le to p a un ture Md eda 4 i be car y for 2).e nef b emedical nefits its pai will b d e by Me e x r pe edn us ced dicare es (12 remai percennt, do s below t wn from h 15% e lev 20 el measur percented i in 200 n 2007 7 but (9 level perc with ent i the n Very Somewhat Not Too Not At All Don't Know/Refused Employee Benefit Programs 38% offers a straightforward, basic explanation of emplo yee benefit ? A sizable perc 5%Aentage of decrease Ver in the v wor yRetir k aSom ers report lu ees Hav e of y ewhat our in th g No Sav ey have t Too ed M virtua No otn A e t Al y fo lly no savings l r Retir Don't Kn emen ow/Rtor investment ef used s. Among RCS spouse are to making deci ? cu The poor rrently savin sions about economy (36 g (do saving and inve Pre wn pa from perc red6 ent). ne 5 p ss e rcent s fting, 2 or RC in 2 0 S 009, perc Worke but ent of work r statistically e s: 2010ers and 34 vs. 20 quival 11 percent of retirees s ent to earlier years).a y they Figure 25, Method of Determining Sa While many policy makers consider vings N it to eeded for Reti be desirablrement, e 26% to 7% limit acc by Wo erkers Do ss to the 37% ing a R money co 62%etirement Needs Calculatio ntributed to retirement n ........... 22 would need $187,000 and a woman $213,000 to h Retirees ave a 90 perc 54% ent c 11%hance of ha 33 vin % g enoug 87%h money to cover 75 percent no (compar The prop eensit d wit minal replacement ratio when combined with av yh to guess or those who h do th ave not 53eir o % )11 te w% n nd calculation 2007 to have 2008 higher may 2009 hel levels erage curre p2 to 010 of savi explai 2011 nn w t Social Security replacement ngs. I hy the n a am dditounts that ion, those who work ratios. The have ers say saved Very Confident savers), those The differences b who etwe have en w Y not ou 8% osh rke don Ver oul rd sav s’ ye ex a retir e s Som peocted e that y e wh ment n 11 at ag % ou ec of No ae n te re Td os c o tireme alculation Notnt an At All d r (co D eon tir m'pared w e t K es’ act now/Ref u iused th t al ah gose w e of retir ho hav emen e), t t mean hose that who Retiremen RCS, rea sharply amon t S chin avin g its highest g those gs Plan 7% s wit ...................................................................................................... 3.5hlev sa se a vings l vls in ings or 20 e inv ss th 07 Wo estments r (2 ker an $ 7 percent s 25, Did C 13% 000 alc very ul (u ation p from confi Di 13% d N 1 de o9 tn Do per t an Ca cd 10 lent i culati percent 62 on n 2 % 0 160 % 7 t no o 43 t at all con p ....................................... 19 ercent ifn ide 2n 011 t), ) and but has programs in the private and public sectors. The EBRI Databook on Employee 18% Benefits is a Almost all ret 201 12 perc 1, down ent in 201 fr irom 15 ees who 0) p anercent d worked long in -term for 2007 pay i care ) and ne r 20 xpe e 44 02 tirement ns perc es20 ( ent o 9 06 in pe t frcent, he 20 reti 07 201 rees r down 0 6% 20 RCS e 08 port from 17 gave a they a 2009 percent positiv re 20 not t 10e in reason oo or not 20 201 07 1 for but at al d statistically oing so, l confident Capital Research and Management Com 11% pany PIMCO 17% 17% Regardless of workers provi whether th ding this ey are curr type 22%4 ently of information saving for r , 29 etir percent ement, say they workers were asked i have less than $1,0 f they thou 00. In ght total, more it was 22% 23% 21% pref In the er to en look d, the retir into inv ement estments on their o savings calculat win a on a nd make ppears to 12% their o be a w partic n dec ula isions. Forty rly effective 58%-seven tool for perc chan ent gin of work g retireme ers nt 5% maintain your cu 24% rrent lifestyle 26% 58% 33% 91% health saving care s plans, such as expenses i 26%n r 401( etir ke )s or IRAs, so ment. that plan money is not depleted before r6% etirement, only a minority calculation assumes the worker starts saving for retir they need to a ement ccumulate for are more likel y than t a comforta hose ble who at age 25 retirement a have not and p saved to retires at age 6 pear to be rat have 10% substantial 27% her lo 5. A linear trend is assumed 47%w. Th leirt vels of saving y-one percent s. In fact, for the of workers ? Lack of faith 6% in Social 28% Security or government 5% (16 percent). 30% 46% Figure 26, Amou a considerabl It should be n nte of S o ga ted th p exists bet avinat alt gs Workers T hough w seen tatis 56 percent of workers h work tiin cal k 6% re Ters h fere ey’ Need ex nce work pectatio for Retiremen on ns em expect to and r ployeeetire t, ben by Hou rece e es fit pr ’ ive bene es x ograms and wor eh peol rid In ence. 9% fits fr come J 31% om a 7% ust 7 k force-related ...................................... defi percent of workers ned bene issues. fit plan ..... 23 are not participating in a retirement savings plan 8% at work (compared 8%with participants), an 33% d those who do not betw shown a een dram $25,000 atic declin –$99,9e si 99 (up nce th from at time 7 per (Fi c12 ent i g %ure 2 n 2 8%) 0.0 7 to 22 p 7%ercent in 2011), while 52 the % perc 8% entage not at all Retirement Sav saying they di ings Needs d so because 16%............................................................................................................................... they w 7% ante 16% d to stay active and involved (92 percent 44% ) or enjo 51% yed working (86 p ............. 20 er- (Fi equival gure 4 ent 7). to t he 10 Needing percent monemeasured y 10 to make e % 44% nds meet in afte 2 r y010 ou ret ) a ire r 17% e unchange 12% d 42% from 43% 2010. S 59%imilarly, the percentages who are 5% 43% 2010 5% 2011 14% LITTLE OR NO SAVINGS: A siza 5% ble 20% percentage of workers 5% re 42 port t % 42h % ey 42 have virtual % ly no savings or investments. Among reasonably than h possible for alf of workers (56 per Less t them to save han $1,07% 00 cen $25 a t) report that the total value week16% (more) for retirement. Si of th 20eir % xty-t household’s savi w 27 o % percent of wor 29% 42% ngs an kers indicate d and plann 28 percen ing behavior. t of reForty-fo tirees pr ur percent efer to receive sug 8% of workers who gestions from a calculate 16% p d a rofessi goal amount onal, but would oft 16% report havin en mak g mae de c their o hanges wn Deere of work & ers fav Compo any r restrictions to the way 11% 24% withdrawals are 11% made Princi from t 24% pal Fina hese accou ncial Group nts. Less than 3 in 10 workers 14% 41% Median predicted savings/income ratio during 68 say they n percent o eed f to save le those whoss t hav han e not $25 saved 0,0 the working career although more tec 00, fo and r retirem anoth ent s er 19 ay their perc 7%ent m assets total less tha 8%ention a hnically corr goal of ect approximati n $2 $1,000. 50,000 –$4o 99,9 ns (e.g., 99. 26% 8% R esponde Wont rkers Respondent and/ 60% or Spouse 17% 26% 87% currently say they in retirement, have plan to retire befor be only 37 nefitspercent report that from A majoe r a age defi 9%A60, m ne inor d com ben 38% they an p 11% eared with 30 percent fit Not 27% plan a d/or 24% (com their spouse cur pared with t A m of ajoreti rho rently h rees se who A mwho repo inorave su are en Not ch a rt they r titled a benefit to e bene tired with a fithat early. ts). In current confident ? A amo chan nge in e g those w mployment 3ith savings of situation (1 $10 11% 0,00 5 per 0 orc more ent). remains 13% low (5 percent, 28% 12% stat 21%istically e 30% quivalent to the 24% Social Secur 7% ity payments will 17% 21% Figure 27, Wor cent). not at a Ho ll con k wev er Confidence fie dr, the percen ent have 11% in Ability rem tage ained stabl to Accumulate Need who repo 27% e, with rt workin 23 14% 11% perce 39g % ed Sa solely 12% nt now 3ving 5% for s for non not 36% Retirement, Among Those Doing a Retirement at finaall con ncial r 16% feident asons i a 18% bsout h small. 20% 13% aving e Ninen ty ough perc ent Evaluation of Progress in Planning and Saving for Retirement ......................................................................................... 25 17% RCS workers providing this 15% type of information, 29 percent say they have less tha 6% n $1,00 27% 0. In total, more than half of that theyinvestments, e could save $2x 5 a K cluding the eepi week ng health (more v insu alue o ) ra , 37% nce or down f their from 26 primary home a % the 68 percent n 18 d a % who r ny defi eported ned bene they could sav fit plans, is less than e (an Workers expecting benef probl itsem from pr a de oblem fined bene problemfit plan are more apt problem than those not probl38% em pr ob expectin lem g such benefits to decis to their ions retir . Sm ement aller plann percenta ing as a r ges wo euld sult. pr Most often, efer suggesti these work ons from a ers say they started professional an Worker d us s saving e these 65 or investing recommendatio more ns 25% each say they favor chan11% ging ret Contact EBRI irement savings Publications, (2 plans s 15% 29% o that 02) 659-0670; 25% workers 23% 40% woul 29% fax publication d be prohibite orders to d from t (20 aking 2) 775-6312. a loan expo Retiree Twenty-two nential curves) conf p idence ercent pro about think duce a similar co ha thving a ey need financi to sa benclusio reduced ave $ lly secure n. 500,00 reti 0–$99 rement a 9,999, ppear while a s to be bout more 1 in 1 stable. 0 each S beli event eve they een perc neeent d Sixteen or previo In an effort to percent of workers us em det ployer. e $rmine 1,000 - The A $m r 9, plan efore, 9 ericans’ spec 99 to reti 28% up to re 1at age 60–64, 9 ific co pe 26% rcent Re ncerns tirees of workers may be expecting to r a although 38 percent bout Social Security an 19 of re d M 16 tir ee dicare, es retir eceive the benefit 8417 % worker ed at these a s and retirees from a ges. additio Needs Calc n, those w ulation ho do not ............................................................................................................. expect em other benefits ployer-provi 50% ded health insur 26% 55% ance in retirem 28% ent are more .................................. likely than those 23 2 percent measured in 2007) (Figure 12). identi FINRA Inv fy at leas estor Educatio t one financial n Fo reason undatio 27% n for 26% having wo 2733% % rked, s 40%uch as Prudential Retirement 27% wanti 38% ng to buy Retire extra es s (72 62 percent), a money for medical expenses (up from 14 percent in 25% 2007, statistically equivalent to the 26 percent measured ? Inadequate finances or cannot afford to retire (13 percent). workers Plannin(56 percent g by Retirees .......................................................................................................... ) report that the total value o 35% f their household’s savings and investments, exclu 74% .......................................... 25 ding the value of additional $25, ) $2 00 0 a 0. we 28% ek in 2002 Subscriptions to and 2003 (Fi gEBRI ure 1 Issue Bri 7). efs 33% are included as part of EBRI membership, or as part of a think th Thirty-four ey w per ill have ret cent of work iree h eres report t alth cov 20% 32 eh % rage throu ey had to di ghp an into employer. their savings Others w 27% to pay ho mor for basi e ofte c ex n say t penses h wi ey wi thin th ll receive e most of the time (18 percent of (59 percent). Other action 26% s reported i 37workers a % nclun dd e:14 percent 27% of retirees) or would prefer a professional to manage against the money in the plR an (29 percen etirement income t), withdr you couldawing any 25% money 15% until they re 71 ac %h age 66 or leave their job 22% 26% say they ar to save $1 mi e not at all confident a llion–$1.49 million (7 bout perc 30% having ent) or $1 enough .5 millio mon or mor ney to 22% live co e (10 mfortably t percent). Ho hroughout wever, savings goals te their retirementnd Orders/ 68% who On the future were asked to do to em other ploy say they a hand, er—a scenar rate t 25 hre a eir perc 2. lev 5 lot io ent of e be that is l of conc hin work d sche becom ern ers (com dule, su about several ing incre pared ggesti asin wi n gl pos g th 7 percent y unlike 66% that sible s more ly, sinc c35% ena 68 w o %ro fios retir e pr rkers could fi regar ivate-sect ees) pla ding nnd t thes or employ to h wait at e emselves program ers, least until in t sin . Rou his age ghly 23% 26% 30% 27% Average Confidence45% 18% 41% 31% 26% 28% decrease in 2010) and in th33 e valu perc e of ent the noT t at all con irr savings or ying $199 annual sub a differf eident abo nt car investments (62 eer s18% cription 6% u 64 t havi %19% to 65% EBR n 28 g perc % en I Notes 40% ou ent 55gh % 34) and % mone , n 18% e EBR edy f ing mon I Issue Brie or long e- y to 36 tfs. e % rm c make Individual are e ends m x cop pen ies se e et s ar ( e av (5 up9 f ail r per- om able Figure 28, Wor 3 ker Confidence in Ability expec 36% to Ac t fromcumulate Savings Needed for the money you Retiremen 64% t, Among T27 hose Doin % 91% g a Retirement their primary home and any defined be Wonefit p rker17% s lans, is less than $25,000. 62% 42% Retiree 24% s 22% 42% 35% Finretiree ancial ? Advice .............................................................................................................. hea The lth coverage cost of livi ng i incl 41% 26% n r ude e workers wi 51 tireme % nt wi 61% ll th be incom highe er tha of atn e least $75, xpected 00 (10 (compar 0 perc 62% ent). ed with lower ............................................. 26 -income their i past 1 Fidelity I Brian K. n 2vestments for t mont n B vestments ucks, hs Arthur B . A similar $24% 10,h 000 em . Kennickell, - percenta $ (13 24 21% ,99 perc 9 Traci L. ge o ent o f r f e work March, tirees ers an 32% (3 14 and 3 d percent) say they had to take Ke 11 percent 13 vin B Russell Inv . Mo 13 of r ore, “Changes in U. e 22% e tirees) 31% stment 13 (Fi G 1 g r1oup ur 31% more than pla e 31). S. Family Finances fro 10 19% nned from m 59% 21% (29 perce (1 denn ot), tes no or taking a ha t at all rdship withdrawal (27 percent). One-quarter (25 percent) say they favor 47% 30% years (statistic Although to increase this as would suggest ally e household inc 40% quivalent that you ome rises to the 1n 8ger (Fi per gure workers are al cent me 26). asured so more likely in 2010). A 20% nothe than ol r 21 per der wor cent of reti 20k %ers to have l 20% rees are not ost too Whil ? e $2Yet many 5 a week may wor 35%knot s ers think t eem to he be y could save a significant more amount of than they money, are curre someone ntly savi who ng managed to s for r 36% etirement. ave this Sixty-eight 70 to particular, 9 in 1 retir 0 worker e hav ane d 8 percent s and retire b The een age at which cuttin indicate they es cur g back o say they ar ry eou ntly becom hav n th e e in will never re eligible e v eir your e defi account ry or some ned ben tire w efi (Figure ht off at conc erin 36 erne g). s. d that t Workers who 45% h45% e cost ar 24% of Me e not 42% dicare confid pr enemiums w t about ill category if they begin to mo 16% re rea with prepa listically 16y % meassess their c nt for $25 each h(f ances o or printed 23% f recopie ceiving t s). Change of Address: his benefit. Workers EBRI, 1100 13th St. who are a lot Needs Calculation ............................................................................................................. 36% 19% Workers 41% 76% .................................. 24 cent), or keeping health insurance or other benefits (40 percent 49%) (Figure 39).27 % 21 percent in 2007, statistically e 15 q% uivalent to the 31 percent measured in 201 17% 22% 0). Another 42% 27 percent each are ? Changing their investment m 39% ix (19 percent). 18% Subscriptions confident, 4 denotes very workers) and workers age 25–34 (compared with 37% older workers). their saving 2004 to 2007: s and Evidence from the Surve for invest Social S ment ecurity s rto etirpay for ba ement y of C benefits 17% osic nsumer Finan expenses (Figure 20 ces,” Federal R ). Te hserve Bulletin e reported lik , Vol. 95 (February 2009): elihood of dipping into Expectations About Retirement ........................................................................................................................................ 28 eliminating early distri Source: bution Employs for ed ee Benefit Res ucatio earch Ins n, home titute and M purc athew Gre hases, or medic enwald & Associates, Inc al ex ., 1993-201 penses (Figure 1 Retirement 23). Workers age ? Wanting to make sure they 16% NW, Suite 878 have enough , Washington, DC money to re , 20005-4051 tir 36% e comforta , (202) 659-0670; f bly (10 percent). ax number, (202 ) 775-6312; confident. confidence At the same time, 24 percent (because t Sourc 32% e: h e am Employount of ee Benefit Re accum search a 32 Ins % r ulated savings te very confid itute and Mathew Gree ent ten nwal(statistically equivalent d d& s to in Associatcre es, Inc ase wit ., 1993-20h 1 a 1 Ret ge i t rem )o , this is ent 19 percent not th in 2010) and e case. amount for perce a year wo nt of savers and 4 uld accumulate 8 per $ cent of 1,300, no whic nsavers say they h is more than 2 think it 9 percent is reas of onably workers report possible for havi them ng to save behi their rise faster nd schedu financial co tha nfident n security in le may in ) flation plan (92 percent o 2 29% reti torement make up pla f for t n wo to rkers and 86 h retire eir 35%plan later, 12% ning and percent on avera sa vin of ge, t g re de tir han those who e ficien es) and cies Medi in ot expr care ben her ess confi ways, as t efits will dence. hey are be Guardian Life Insurance Company 30% 34%Schwa 33%b NO RETIREMENT SAVINGS GOAL $25, 17% 000: - Many $49,99worke 9 rs continu 13 e to 12 be NA una 10 ware o 12f how much 11 th 12 ey need to sa 11 ve for retirement. not too confident a Con bout cov fidenc will e S incr urv e ease b ey ring me s. 36% efore dical y34% ou rand etire long-ter Retirees m care expenses in retirement (Figures 5 and 6). Figure 29, Worker Progress in Planning and Saving for Retire 23% men11 t .............................................................. % 16% 14% ....................... 25 However, there are some types of advice t Confidence S 29% urveys. NA hat workers would c NAlearly NA va NAlue. Virtually all those offered an 27% 31% 33% e-m 38% ail: subscriptions@ebri.org Membership Information: 15% Inquiries regarding EBRI saving A1–A55. Workers s and who investments d have done a r ecreases as saving e tirement savings n s an eeds d in cal vest cula ments or ho 33% tion also tusehold incom end to have hie gher rise. savings goals than do 36% 30% Retiremen Health Care 55 and older are more likely t Age ................................................................................................................ Expenses in Retireme than you 30% nger nt workers to favor eliminating early distributi 32% ........................................... 28 ons for education, home 36 Younger perc ? ent a Reduc work re ers are somewhat ing debt statistically no or s co pnfident. ending ( more likely tha Like 16 31% perc worker co ent). nnfi old de ence, r r work eers to state they are tiree confidence in having not at a enou ll con ghf imoney for dent (Figure accumulated $25 a in total. However, th week (more) for retir ose ement. who have alrea dy saved for reti24% rement are more likely than those who Few retir Those not reduc ? ed (88 percent Needin ees exwho pecting to r g to have pa of y current not work ecei R already v e ers and 87 ti e retir re expenses first ment i worked for pay in ee 31% ncom heal per e y th insura cent of retirees). Almost as ou coul (9 percent 42% d n reti ce frrement )om an .11% antici employ 41% pate r many say they er (compare eturn 11% ing to pa 27% d with t are 30% id emplo concern hose wh e yment. J d that o do) also ust more likely than better prepared workers t 40% o say they wil 40% l retire at o 40% lder ages8% and work for pay in retirement. Only 42 percent report they and/or their spouse 39have tri % ed to calcu 44%late how much money they will need to have saved 28% 37% 10% 33% Confidence in Entitlement Progra 11% ms 37% 7% employer-sponsored retirement s membership and/or contributions to EBRI-ERF avings plan say they would find eac 43%h of should be directed to EBRI President/ASEC the following very or somewhat Social Security 39% Employer-sponsored traditional pension IBM Segal Company Figure 30, Timeframe When workers who have not do Retirees Began to Plan Financiall neexpec the calcul t from the m ation. oneyTwe in the nty-fy for Retirement, Among Retirees Who Planned for ive percent 6% of workers who 29% 29% have don 6% e a calculation, purchases, or medical 8% 27% expenses. 30% Working for Pay in Retiremen $50,00026 - t ................................................................................................. % $99,999 15 12 13 12 12 43%11 ..................................... 31 9 13). retirement has This might seem varied over Source: count Emplo th yee er-int e 21 yea Benefiuitive t Research Insti rs of t giveh tn th ute RC e and 63 e % M S. positive relat athew It remained fa Greenwald & 55 i Associ onshi % irly s ates, Inc. p betw teady at , 1993-201 een age 1 rou R 34 eti %and a rem ghly 40 ent ccumulat 24% 89% percent ed savin very gs, 2 percent In have not the 20 save 09 say RCS, 40 d to r it is very e port pe likely rcent of the they y can save thi reti will rees in work dicated that, 61% s for money. pay some In a so dditio far time in in t n, th the heir e lik f ru etelihood of tirement, ure, and o their spendin fnly eeling 8 percent able to sav g say on healt it is e this h care 4 plan Social S Worker to reti confi ecurity re dlence t ater. payme hat t nts 1.5hey will are be re doin duce g a d g (87 ood j perc ob o ent o f prfe workers an paring financ d or84 percent ca ially for sh 36% balan retir c 20 e p % of r lae nment is etirees). per Three-quarters o haps the most f 4% Chairman Dallas 59% Salisbury at the above address, (202) 659-0670; 19%e-mail: salisbury@ebri.org by the time they retire so that they can live comfortably in retirement. 39% ? ? Researchi Needing to ng o pay for ther pl ways to s health an if you conti caa re costs (7 ve for nue to 49% retir save per e ament t cent). (7 percent). 48% 38% Debt See Paul Fronstin, Dallas Salisbury, and is also a probl33% e 3% m for a signific 54%ant nu Jack mber o VanDer f worke hei, “Funding Sa rs. Twenty vings -two perc Needed fo ent report their r Health Expenses 3% level of debt For Perso is a n s valuabl ? Retireme e i Many workers f it w nte .................................................................................................................... re Confi provided a dence S 52% continue urveys. 52s % part o to be f th una eir ware plan of (Figure how muc 32): h they need to save for retir 3% ement. ..................................... Only 42 per- 26 44% 43% 44% 44% The reason that workers may be less likely to expect tha 17% n retire17% es are to receive income from Social Security is compared with 10 percen 40% t o 15%f those who have not, 16% estima 41%te they 15% need to accumulate at least $1 million for 13% 14% 13% Planning by Reti 19 38% 12% 93 rees 1996 36% 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 confident but it is likely and due 10 perc to th ent e siz no able t at all con the r minority ate you ar fident from e sav of ol ing der now worke 2001 t rs who hrough 2007, but the perc have very little savin 10% 10% entage very co gs. While it is reasona nfident ble So(additiona urces of Retire l) mmen oney incr t Income ease.................................................................................................. s as the amount already saved or household income rises. 35% 9% ................................... 31 somewhat l has be Mass workers stable co Mutual Financial en (76 percent nfi high d ikely. Instea en ece i r tha Sn ourc dicator n ) ar e e: Group E xe co m d, vi pect ployee of all. ncerned t ed. rtually al Benef Workers itThe Resl say earc h pe at t h Ircentage ns may also be h a retur te a itut 30% e g and e at n M to avery thew whi pa Greenwal f ailing to tak ch they confident id em TIAA-CRE d ployment & beco Assoc rem ie at me eli es health ained at ro F , I In is not too n34% c., 1993-201 stitute g care ible for 34% 1 co ugh Re (19 Social tists sufficie rem ly 25 percent perc ent Sec entu )n or rit tlyy n into account retirem between ot at all e nt 33% continue to expect to piece 26% together their retirement income from 27% a wide variety of sources. Seventy-seven Eligible for Medicare,” major probl cent r em, and an eport th EBRI Is ey an additional 41 perc d/or sue Brief, their spouse no. 351 (Employee Benefit Research Institute, December 2010). ent describe have trie 23%d to c it as a mi alcul nor ate ho problem. 24% w muc Ret h money t irees are hey less likely than will need to h ave ? Needing to $1 m 00, ake u 000 -p $ for 249, 22% los 999ses in th 15e stoc1 k market 1 15 22% (6 percent 15 ). 12 11 14 because confidence in Social Security’s a 21% bility to maintain the value of benefits paid to retirees is low (Social retirement. At the other extr Co19% nfidence Surveyeme, 24 perc s. ent of those who have done a calculation, compared with 36 percent Figure 31, Preferred Approach Editorial Board: Dallas L. Salisbur to M y, publisher aking Dec ; Stephen Blakely isions About S , editor avin.g Any an views d Investin expres g sed in this p .................................................. ublication and those of the author ................ s should 27 One r ? eason fo Deciding r the di to w 199ffer 3ork e 199 nc longer (5 6e between 2001 perce 2002 wo nrkers’ expect 2003 t). 2004 2a 005 tions 20 and retire 06 2007 es’ 2008experienc 2009 2010 e of retire 2011 16% ment age is that 15% EXPECTED RETI decli for many ned in youn REMENT AGE 2008 a ger nd 2 workers to RI 009 SING and t ex : The age at 28% pect he perc their 27%en a which tage 27% ccumulate not at work all ers expect to retire conti d sa confi vings w dent inc ill gro rew ased substant (Figure nues its slow, iall 13% y be 3). fore t upward tren hey retire, t d. h I ese n (68 when perce estimati nt) ling t kely. heir retirement needs. Workers are now more likely to expect (36 percent) than retirees are Health Seven bene 2003 a Care Expen fits will in n Nod 2007, and t 10 retirees AtAll  Co inncrease befor fidses ent in(69 perc has sin Reti 1remen ece rema they ent) in t ............................................................................................ retir dica ined s e (Fi te t tg eady at hure ey did some 48 rou ). ghly type o 22 perce f financi nt (21 al pl perc anni ent ng for in 2 retirem 010 an ................................. 33 d ent. 22 perc Forty-three ent in Retirement Savings Retirement Savings ? A statement u 1998nder Needs Plans 2001 certai 2002 n assumptions about how muc 2003 2004 2005 2006 2007 h they sho 2008 uld save so that 2009 2010 2011 they can maintain percent of workers expect Social Security to be a major or minor source of income in retirement, but they 21% workers to r not be ascribed to the officers, eport debt is a trust major (1 ees, mem 5 bers, or percent) or a other sponsors of the E 18% minor (27 19% perc mploye ent e Benefit Research ) problem. However, Institute, the EBRI Educ while workers’ ation and Merck How would w saved by orkers save th the t Beforie me they retire 55 is $2 55-4 a 59 w so that eek 60-? Most ofte 64 they6 can live comfo 5 n, workers who rep 66T. Ro -69 rtably in ret we 7 17 0 o %rPrice olde ort they could r iN rement. ever Do save this m n't know oney say Source: Very conf Empl id oent yee Benefit S Rom esearch Insti ewhat con tute and fident Mathew N Greenw ot too con ald &f Associ ident ates, Inc. N, o1993-201 t at all con 1 Rfe id tient rement Security is the federal program that provides income support for the aged 14% and disability coverage for eligible who have not, think Source: 13% they Emplne oyee ed to Benefi save le t Research Insti ss than tute and $2 Mathew 50,0 Greenw 00 for r ald & Associ etirem ates, Inc. ent. , 1993-201 13% 1 Retirement ? A change in the minimum retirement age for Social Security (5 percent). 11% 11% many Americans find themselves retir Lowest ing unexpecte2 dly. The RCS has 3 consistently fo Hund that a ighest larg e expectations may not be reasonable for the 29 percent of workers age 55 or older who still have less than Figure 32, Valu particular, the perc e of Various Ac entage of workers count Stateme 7% who n expect to ts if Provided retiras e aft Part of Retirement Savi er age 65 has increased over tim ngs Plan, Among Workers Offered e, from 11 percent in an percent of these retirees say they to report 2011). The havi percenta ng (27 perc ge CA onfi gnot es dence S en 25 t) acc at all -34 urveys. econfi began to ss to employer-provi denA t rose slig pla ges 35- n 20 y 44 htly from ears or more befor ded health 1 Ag 2es perc 45 ins -54 urance ent e they in wh 2008 retir en t to 17 perc Ae ges hd ey reti and 55+ 23 percen re ent in 201 (Figure t report 43 1 ). Research Fund, or their staffs. $250, Nothin 000 or g her more ein is to be co71 nstrued as an attem 2 1p4t to aid or12 hinder the adoption 12 retire11of any pending le 10 gislation, regulation, Confiden ? ce in their c Deciding to Entiu tlemen rrent Confiw dence S li t Pr o festyle a rk more ho ograms ............................................................................................ urveys. fterur th s or a seco ey retire (91 nd percent job (3 perce ). nt). ................................. 35 believe that personal savings will also play a large role. Roughly 7 in 10 each say they anticipate receiving One of the Many workers pri m continue ary vehicl 1998 to e 2001 s be that work una 2002 wareers u 2003 of hs oe to save w muc 2004 h 2005 th for ey nee retirement is a 2006 d to 2007 save 2008 for retir n em2009 ployer-s ement. 2010 ponsored r Less tha 2011 e ntirement half of evaluation they would cu of tt back or heir debt 1 give 994 prob 199 up lem do 6 dini 2000ng out es 20 not 01 2 002 appe (34 perce 20ar to 03 2004 n ha t).v 20 eOthers say they 05 incr 2006 eased 2007in 2008 severity woul 2009d 2010 since give20 u the question 11 p or cut back was on last Source: 1993 Em1996 ployee B2001 enefit Research Insti 2002 2003 tute and 2004 Mathew2005 Greenwal 2006 d & Associ 2007 ates, Inc. 2008 , 1993-201 2009 1 Reti2010 rement 2011 workers and their dependents). Five percent of workers are very confident that the Social Security system will As would be expected, worker confidence in having enough money for a comfortable retirement increases with Source: Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc., 1993-2011 Retirement Sources of Retirement percentage Employer-Sponsored Plan of retirees leave the work ............................................................................................................................... Income force earli Quar er tth ile*an of p Agl e- an spn eci efd ic ( Pr4 ep 5 pe arednes rce s nt in 2011) (Figure 37). Many ..... 27 or interpretative ? Wheru nle, or as workers legal, are asked to accounting, actuarial, o evaluate r other such prof their progress i essional advice. n plannin ww g a w.n ebri. d saving for r org etirement, 70 percent 1991 a $10, MetLife nd00 19 0 in 96 sav to 20 ings. pe rcent in 2001, 25 percent in 2006, and 36 Vanguard Gro percent in 2u 0p 11. However, many employers are el S Cource: onfi 1992 dence S Em1996 pl u o rveys. yee B2 enefi 001 iminati t Research Insti 2002ng 2003 health tute and 2004 care co Mathew2005 Greenw verage for al 2006 d & Associ 2007 fut ates, Inc. u2008 re r , 1993-201 etirees, s 2009 1 Reti2010 rem o some work ent 2011 ers may fin d beginni (statistically equivalent to ng to plan between the 16 10 and pe 19 rcent year measured in s before retire 2010). ment. Ho Togeth wev er er, 1 with t 3 perce he 19 n perc t say they started ent of workers who plannin g retirement income from CS onfi ourc dence S e: E an mp ulrveys oyemployer ee .Benefit Res-spo earch I nsored r nstitute and M etire athew Greenwal ment savin d & Asg soc s iat plan es, Inc (73 perc ., 1993-2011 Ret ent), a irementn individual retirement RCS Methodology ............................................................................................................................................................ 39 savings pl asked in workers Despite ? these the 2005 RCS, (42 A statement u an, percent such as a higher ) r goals, e n 40 retir port der 1 certai (workers w ees are k). they an Sn a eventy-nine d/or no ssumptions about how mu h w o th more like have eir spouse per done cly to ent a r hav os e fa tirement el e y debt trie igible d to c is work h n retirem a calc e emaj d ers (36 s calcu ulate oe r probl nt how in lperc ation come they e mu m (1 en are more t of a ch money 5 perc co ll worker ent uld like the ,ex up ly than t s) say they y pect from will fro ne 6 hose m ed pe r- entertainment or leisure activities (22 percent) smoking or cigarettes (10 percent), groceries (10 percent), or continue to provide Confiben dence S efits urveys. of at least equal value to the benefits received by retirees today, and 24 percent household inc ? Enrolling in ome. Sou a rWorker ce:r e Em tirement ploy ee confidence Benef savi it Researc ngs plan als h Ins o ti increases tute at and w Mat ohrk (3 ew wi Gree th savings percent nwald & Ass)oc . iand investments, ates, Inc., 1993-2011 Retirem educatio ent n, and improved At the same time, 10 Confidenc percent of wo e Surveys. rkers changing their retirement age in the past year (2 percent of all retirees who retired earlier than planned cite negative reasons for leaving the work force before they expected, state that t Source: Employee hey Benef are it Resa littl earch Ins e or titute a lot calculatbehi ions. nd schedule. This is 15 percentage points higher than the Although the vast majority of retir Source: Sou Erm ce pl : o E y m ee ployee Benefi Ben tees R efi et search Insti Rese (91 perc arch Insti tut tut e and ent e and M ) M a repo a thew thew Greenw Gre rt that Soc enwal al dd & & Associ Associ i ate al ates, Inc. s, In Security c., 199 , 1993-201 3-2011provi Reti 1 re R m ed en tirem es a t ent source of income for Figure 33, Wor five to their say they ar expectati nink e years before r ers Expectin e not too confident, this ons to be u g ton e Retire L realistic. tirement ater m and 16 percent eT ans han Plann that 36 e pe d star ..................................................................... rceted l nt inedicate ss than the five years y lack con befo fidere retir nce in th ement eir ........................... fin (Fi ancial gure 30). 28 Source: Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc., 1993-2011 Retirement Confidence Surveys. account or IRA (66 percent), and other personal savings and investments (65 percent). Seventy-seven percent partici to have saved by t pate in such a he t plan ime t wih th thei ey retir curr re so t en ht employ at they ca er n(F live comforta igure 22). Fur bly in r thermore, etirem28 ent perce . This is com nt of par ptarabl icipants e to Endncent) (F who have not to impulse otes ...................................................................................................................... buyi ig the mon ure n21) g (9 e . fee S perc y th ourc l econ : eE ent y m current f plioyee ) d. eOne i nBenefi t that ly ha n t R 1 ethey w searc 0 ve in (9 h Insti percent their ill be tute and acc a ) M b state ale o thew unt to a Green t (91 ccumulate hey wo w perc ald & Associ uld not ent). the ates, Inc., amount nee 1993 d to -201 they give 1 .................................................. 39 Retirem up or need for ent cut retir back e on ment. SoC ur onfi ce:dence S Em Confi pld oyee eu nrveys. ce Sur Ben veys. efit Research Institute and Mathew Greenwald & Associates, Inc., 1993-2011 Retirement are somewhat *Quartile confi threshhol d ds ent. Neverthel based on 2010 RCS w eor ss, 39 percent kers. of workers are not at all confident that future Social Despite health EBRI Issu status. the e Brief in iscreasing real Others mor register Confidence S ed in the U. ure ism, some work v eys. often co S. Patent and T nfiden radem ers still ap t are m ark Office. en pe (co Ia Sm r to provid SN: 0887 pared with women ?13e 7X/90 conflicti 0887ng respo ) ?, marr 137X/90 $ . ied workers (c nses with 50+.50 respect to ompared with MORE EXPEC workers) repo TING TO W rt they ORK I will N RETI retire sooner REMENT: More than they worker has now d planex ned, pect t primar o work ily due for to paypoor h in retirem ealth or ent. d S isa ebil venty-four ity. including health problems or disability (63 percent), changes at their company, such as downsizing or closure 55 percent of workers who felt behind schedule in 2005. Confidence Surveys. their and their sp Coo nfiu dse ence Surveys. ’s retirement (68 percent say it is a major source of income), workers and their spouses preparations for retirement (Figure 7). Doubts among workers about the adequacy of their financial expect employment to provide them with a source of income in retirement, 56 percent expect to receive Figure 34, Trend in Workers’ Expected Retirement Age ...................................................................................................... 29 report t Twenty-six hat th peey have incr rcent of those ea swho ed th have e perc don entage of their e a calculation salary that they cont report they are very co ribute to nfide the plan nt that they in the past will be a year, ble anything in order to save $25 a week. Security benefits will match or exceed the value of today’s benefits, and uncertainty about the future of Social percent report confidence an those not mar they d ret ried), those plan irement preparatio to work in who part retiricipat ement n. e Siin a xteen (up from de percent fin e 70 d c po e of very co ntributio rcent in n 201 nfi ret d 0), ient rement thre workers ar e ti pla me n s the perc (compared e not currentl entage of retirees withy those saving who for Figure 35, Trend in Retirees’ Actual Retirement Age ........................................................................................................... 30 who say they actually worked for pay in retirement (23 percent). © 2011, Employee Benefit Research Institute ?Education and Research Fund. 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Volume 355

Pages 40

EBRI Issue Brief

Ruth Helman

Craig Copeland

Jack VanDerhei

Retirement