Many Americans are stressed about their financial preparedness for their retirement years.
Most of those who are stressed are likely not taking the proper steps to prepare financially, according to a new study.
According to recent research by the Employee Benefits Research Institute, most Americans who report feeling stressed about retiring also report feeling financially insecure. The survey results highlight the need to get your financial house in order long before you are nearing your retirement to ensure that you can live comfortably in your senior years.
In their study, the researchers found that:
- 30% of participants felt stressed either emotionally or mentally in relation to retirement preparation.
- 30% said that they were worried about finances during their workday.
- 48% percent of workers who reported feeling stressed said that they would likely be more productive at work if they did not spend so much time worrying about their finances.
Despite these results, many people fail to plan. The survey found that:
- 59% said that they had done some planning and saving for retirement.
- 40% reported trying to calculate an accurate amount of money needed during retirement. Some participants also spent time calculating how much money they would need from Social Security in the future to survive.
- 34% said they had calculated their estimated living expenses during retirement.
Many people who need assistance in financial planning are not seeking out the assistance of a financial advisor:
- 20% of participants said that they had spoken with a professional regarding retirement planning.
- 9% reported already having a formal plan that was feasible and realistic.
Researchers pointed out the importance of working with a financial planner.
Also, they emphasized that people can do many things on their own for free such as calculating Social Security income.
Workers should fully take advantage of any employer savings incentives such as contribution matching to 401(k) plans by funding their plan at least enough to get their employer’s full matching contribution.
Researchers also recommended that employers offer education about retirement saving, provide attractive plans and encourage participation in multiple ways. To learn more about helping workers save for retirement, give us a call.