Retirement—Hope Is Not A Plan
Good to Know
Just two of every ten workers are very confident about having a financially comfortable retirement, according to the EBRI® 34th Annual Retirement Confidence Survey. What is driving this lack of confidence? Factors include inflation fears, Social Security concerns, and a recession threat.
Inflation—More than 8 of every 10 workers believe that just paying their bills will reduce their ability to save for retirement; they also believe inflation will continue at higher-than-normal rates for at least the next year.
Social Security—About 8 of every 10 workers fear that the government will address Social Security’s insolvency by reducing future benefits, increasing retirement ages, or other unpopular changes for those approaching retirement.
Recession—Alarmingly, over 7 of every 10 workers fear a recession within the next year. While that number is down slightly from last year, it remains sobering.
The lack of confidence in retirement income security, while grim, is slightly improved from last year. The improvements appear to be driven by the perception of higher wage growth than the rate of inflation, according to a report by the U.S. Census.
Financial advisors take note, a lifetime income strategy continues to attract an increasing number of workers and retirees. Given that most retirees literally fear running out of money more than death, it’s no wonder a guaranteed income for life resonates so viscerally.
Be sure to check in with your clients to help them plan around their concerns, rather than being stunned when their hopes for retirement are dashed. In the words of a famous TV personality, Hope is not a plan.
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The material contained in this article is to raise awareness—it is informational, general in nature and does not constitute financial advice. It should not be relied upon or used without consulting a credentialed financial professional to consider your specific circumstances. This communication was published on the date specified and may not include any future changes in the topics, laws, rules or regulations covered.
