2004 retirement confidence survey - aarp · 2018-08-23 · you will have enough money to take care...

2004 Retirement Confidence Survey2004 Retirement Confidence Survey

Employee Benefit Research InstituteAmerican Savings Education Council

2121 K Street NW, Suite 600Washington, DC 20037

Phone: (202) 659-0670 Fax: (202) 775-6312

Mathew Greenwald & Associates, Inc.4201 Connecticut Ave. NW, Suite 620

Washington, DC 20008Phone: (202) 686-0300 Fax: (202) 686-2512

2004

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73%78%

69% 72% 71%

57% 58% 60% 66% 59%68% 74%

65% 67% 68%

68%

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Respondent Respondent and/or spouse

7 in 10 workers say they have saved for retirement.Not including Social Security taxes or employer-provided money, have you (and/or your spouse) personally saved any money for retirement? These savings could include money you personally put into a retirement plan at work. (2004 Workers n=785)

Source: EBRI/ASEC/Greenwald, 1994-2004 Retirement Confidence Surveys

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2 out of 3 retirees say they saved for retirement.

67%59% 61% 62% 64%

52% 48% 52% 50%59% 66%

54% 59% 61% 63%

65%

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004


Not including Social Security taxes or employer-provided money, did you (and your spouse) personally save any money for retirement before you retired? These savings could include money you personally put into a retirement plan at work. (2004 Retirees n=217)


4

Two-thirds of workers are able to save $20 a week (more) for retirement.

68% 66% 64%59%

68% 68%66%

1998 1999 2000 2001 2002 2003 2004

Do you think it is reasonably possible for you to save $20 per week (more than you are currently Saving) for retirement? (2004 Workers n=785)


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Even half of non-savers say they could save $20 a week for retirement.

No26%

Don't know/

Refused2%

Yes72%

Do you think it is reasonably possible for you to save $20 per week (more than you are currently saving) for retirement? (Among workers)

Savers(n=540)

No43%

Don't know/

Refused3%

Yes54%

Nonsavers(n=245)

Source: EBRI/ASEC/Greenwald, 2004 Retirement Confidence Survey

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Worker confidence in having enough money for a comfortable retirement remains steady.

6%

19%

55%

18%

17%

17%

45%

20%

8%

19%

51%

21%

16%

23%

41%

19%

15%

19%

41%

24%

13%

18%

45%

22%

9%

21%

47%

22%

10%

18%

47%

25%

17%

18%

41%

22%

10%

19%

47%

23%

16%

17%

45%

21%

13%

18%

44%

24%

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Overall, how confident are you that you (and your spouse) will have enough money to live comfortably throughout your retirement years? (2004 Workers n=785)

Very Not at allSomewhat Not too Don’t know/Refused


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5%7%

16%

45%

27%

13%

21%

37%

27%

6%

18%

47%

26%

8%

20%

42%

26%

11%

18%

34%

33%

5%

24%

24%

28%

19%

8%

20%

39%

31%

11%

14%

41%

34%

5%

11%

10%

37%

37%

11%

16%

32%

40%

11%

12%

35%

39%

13%

16%

27%

42%

1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004

Overall, how confident are you that you (and your spouse) will have enough money to live comfortably throughout your retirement years? (2004 Retirees n=217)

So does retiree confidence in having enough money to live comfortably throughout retirement.

Very Not at allSomewhat Not too Don’t know/Refused


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16% 35% 26% 22%

21% 40% 21% 17%

23% 40% 20% 14%

26% 47% 14% 12%

36% 47% 8% 8%

Very Somewhat Not too Not at all

Next, I would like to know how confident you (and your spouse) are about certain aspects related to retirement. (Workers n=785)

Workers most confident of basic expenses, least confident of long-term care expenses in retirement.

You will have enough moneyto take care of your basic

expenses during your retirement.

You will have enough money topay for long-term care, shouldyou need it during retirement.

You are doing a good job ofpreparing financially for your

retirement.

You will have enough moneyto take care of your medical


You will not outlive your retirement savings.


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30% 23% 18% 27%

35% 28% 12% 18%

36% 36% 16% 11%

38% 31% 13% 16%

44% 32% 14% 8%

Very Somewhat Not too Not at all

Next, I would like to know how confident you (and your spouse) are about certain aspects related to retirement. (Retirees n=217)

Retirees are also most confident of basic expenses, least confident of long-term care expenses in retirement.

You will have enough moneyto take care of your basic


You will not outlive your retirement savings.

You will have enough money to pay for long-term care should

you need it during retirement.

You did a good job of preparingfinancially for your retirement.

You will have enough moneyto take care of your medical



People have unrealistic expectations about retirement

and retirement income.

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5%

9%11%

17%

9%

6%

12%

29%

26%

15%

22%

13%

6%

3%

Before 55 55 - 59 60-61 62-64 65 66 or older Neverretire/plan

to retire

Workers Retirees

Realistically, at what age do you expect to retire? (Workers n=785)How old were you when you retired? (Retirees n=217)

Workers plan to work much longer than current retirees actually worked.


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52%

44%

3%

40%

53%

3%

48%

42%

7%

48%

40%

7%

46% 45%

5%

40%

49%

5%

36%

55%

6%

39%

49%

6%

43%

50%

6%

39%

50%

6%

37%

52%

6%

1991 1992 1996 1997 1998 1999 2000 2001 2002 2003 2004

Earlier than planned About when planned Later than planned

Did you retire earlier than you planned to, retire later than you planned to, or retire about when you planned to? (Among employed retirees, 2004 n=182)

Some workers may meet their goals, but others may end up retiring early like 4 in 10 retirees.


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N/A

7%10%

13%

28%

15%

28%

7%11%

3%

8%

39%

7%

13%

7%

2%

Workers Retirees

About what percentage of your pre-retirement household income do you think you (and your spouse) will need to live comfortably in retirement? By pre-retirement income, I mean your household income right before you retire. (Workers planning to retire, n=739)About what percentage of your pre-retirement income is your current household income? (Retirees n=217)

Workers expect to life comfortably on less of their pre-retirement income than retirees currently have.

Less than 50%

About95-105%

105%or more

Don’t know/Refused

About50-70%

About70-85%

About85-95%

Lower (Don’t

know %)


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Less comfortable

than that35%

More comfortable

than that19%

Same as standard of living right

before retirement

45%

Yet 2 out of 3 workers expect to be at least as comfortable as before retirement.Thinking about the standard of living you will be able to afford in the years immediately after your retirement, do you expect that it will be the same as your standard of living right before retirement, be more comfortable than that, or less comfortable than that? (Among workers planning to retire, n=739)


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3 in 5 workers do not expect their standard of living to decline over time.Thinking about the standard of living that you will be able to afford in retirement, do you expect it will stay the same as you age, become more comfortable as you age, or become less comfortable? (Among workers planning to retire, n=739)

Don't know3%

Less comfortable as

you age38%

Stay the same37%

More comfortable as

you age22%


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Most workers expect to do some work for pay during retirement.

62%

22%

66%

27%

65%

22%

61%

26%

66%

24%

70%

28%

68%

32%

1998 1999 2000 2001 2002 2003 2004

Workers Retirees

Do you think you will do any work for pay after you retire? (Among workers planning to retire, 2004 n=739)Have you worked for pay since you retired? (2004 Retirees n=217)

Source: EBRI/ASEC/Greenwald, 1998-2004 Retirement Confidence Survey

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7%

12%

2%

32%

3%

15%

6%

21%

61 or under 62 63 - 64 65 66 - 67 68 or older Don't know

35%

At what age will you be eligible to receive Social Security retirement benefits without a reduction for early retirement? If respondent says already eligible, ask: At what age were you eligible to receive Social Security retirement benefits without a reduction for early retirement? (Workers n=785)

Too lateOn timeToo early Don’t know

Many still don’t know when they can receive unreduced Social Security retirement benefits.


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41%

35%

50%

52%

22%

65%

Workers

Retirees

Workers may be overly optimistic about receiving some employee retirement benefits.Please tell me whether you (and/or your spouse) (expect to receive/receive) the following benefits from an employer. (Workers n=785; Retirees n=217)

Money from a workplace retirement savings plan, such as a 401k, 403b, or 457 plan

Money from a defined benefit pension plan which typically provides a monthly benefit for life in retirement, with the amount often based on salary and years of service

Retiree health insurance

Percentage answering “Yes”


Most do not have a good idea of how much it takes to fund a

comfortable retirement.

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3 in 5 workers have not attempted to do a retirement savings needs calculation.

48%53%

44%38%

43%

31% 32% 29% 33%42% 45%

51%39%

32% 37%

42%

1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004


Have you (and/or your spouse) tried to figure out how much money you will need to have saved by the time you retire so that you can live comfortably in retirement? (2004 Workers n=785)


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16%

7%

10% 10%12%

3%

32%

11%

$1,000,000to

$1,499,999

$250,000to

$499,999

$1,500,000or more

Under$250,000

Don’tknow/Don’t

remember

$500,000to

$999,999

RefusedCouldnot do

calculation

How much did you (and/or your spouse) calculate you would need to save in total by the time you retire? (Among workers trying to do a retirement needs calculation, n=332)

One-third who have done a calculation can’t remember the result.


Some have made changes in their retirement plans and

may think these changes are enough.

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1 in 7 workers age 45 and older expect to retire later than planned one year ago.

15%

8%

24%

8%

13%

5%

2002 2003 2004

Yes, older Yes, younger

In the past 12 months, has the age at which you expect to retire changed? If yes, will you retire at an older or younger age than you previously expected? (Among workers age 45 and older, 2004 n=256)


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A few retirees say they are likely to return to work for pay.

Somewhat likely9%

Not too likely21%

Not at all likely65%

Very likely5%

Realistically, how likely do you think you are to work for pay some time in the future? (Among retirees who have not worked for pay since they retired, n=147)


25

80%

63%

53%

43% 41% 41%

24% 21%13% 12%

Retirement benefit

statements

Newsletters/ magazines

Brochures Seminars or group meetings

Individual access to a financial

planner

Videos or CD-ROMs

Workbooks/ worksheets

Online investment

advice services

Software programs

Other online services

Thinking about the information on retirement planning and savings that you received from your employer or retirement plan provider in the past 12 months, which of the following have you used or participated in? (Among workers given educational material or seminars through employer, n=269)

Informational materials/formats that workers can hold/ talk to are most often used.


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8%

<.5%

1%

2%

5%

6%

6%

7%

20%

20%

23%Individual access to a financial planner

Newsletters/magazines

Online investment advice services

Brochures

Workbooks/worksheets

Retirement benefit statements

Seminars or group meetings

Software programs

Videos or CD-ROMs

None

Other online services

Which was the most helpful to you? (Among workers given educational material or seminars through employer, n=269)

In-person formats where workers can ask questions, or personalized materials are seen as most helpful.


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Putting Income in Perspective

• 7.7 million retirees have a private DB annuity. The median value is $6,000 or a wealth equivalent of about $170,000.

• Median SSA income is $11,800 or a wealth equivalent of about $339,000.

• For 65+ with no pension income a median SSA of $8,988 or a wealth equivalent of $256,000.

Note: Annuity conversion rate of 3.5% assumed.

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ebri.orgchoosetosave.org

2121 K St. NW #600Washington, DC 20037

202/659-0670

2004 retirement confidence survey - aarp · 2018-08-23 · you will have enough money to take care...

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