Retirement Income Is not Exactly What Retirees had Hoped

Those soon to be retired may discover a recent survey helpful. The survey of 2,000 people retired within the past 2 to six years explained that new retirees are a money-worried, cash-strapped group, and reliant on Social Security mainly because they have insufficient retirement funds. Nonetheless, they find satisfaction with their new life. Let us take a look at some of the key conclusions.

Important stats and views of those surveyed

The studied retired people 'had an average household retirement income of $49,000, but a median (half had more, half less) home income of only $34,000. The group is almost equally divided between all those living much better than in their working years and those living on less. About 1 in five are 'struggling' economically.'

A fifth of participants have a organized withdrawal strategy of their retirement funds, and on average, they pull out about 6.seven % a year. At that rate of withdrawal, a retiree's financial savings will probably be exhausted in approximately 17 years, assuming a collection of forty % shares, 50 % bonds, and ten percent cash at historic rates of return [stated by analysis].'

Contrary to the common image of care free retirees traveling, studying, and volunteering, their most significant objectives are having a safe retirement income rather than worrying excessive about cash. Investing more time with members of the family places a distant fourth, accompanied by traveling and pastimes. Recent retired people are not especially thinking about returning to school to learn some thing new. However 27 % of recent retired people would rather be at their old job than retired.'

The majority of participants 'are concerned about financial situation and also the stability of government-funded plans. Forty-one % are extremely worried they have inadequate retirement funds and will outlive their money. Despite these financial concerns, eighty four percent of new retired people state they're 'satisfied' with their new life situation. Fulfillment increases, nevertheless, as retirement savings and retirement funds increases.

These surveyed would be the first generation of workers straddling both conventional (described benefit) retirement plans and self-directed 401(k) retirement plans introduced in 1981. Conventional pension programs offer twenty four % of their retirement funds; earnings from self-directed retirement programs, as well as additional purchases and retirement savings, accounts for 11 percent. Social Security is undoubtedly probably the most important economic resource, which represents forty one percent of retirement funds.'

Only sixteen percent of recent retirees had a official, written retirement plan even though the number using professional financial consultants rises dramatically with resources. Fifty-four percent of those with net worth more than $500,000 have utilized a retirement expert, while only 16 percent of those with $150,000 or less have done so.'

The key point for those about to retire:

'The cash concept carries through on recent retirees 'greatest regrets. Seventy % wish they'd more retirement funds and fifty nine % wish they'd began economizing earlier.
What was their greatest surprise? It was 'that they have not enough retirement funds and high expenditures.' More than one-third want their former employer or retirement program supplier had done more to motivate them to save earlier and quicker.'