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Most Americans Unsure on Retirement Needs, Some Never Plan to Retire
Millennials are most likely to be unsure of how much money they’ll need in retirement (69%). However, older Americans aren’t much closer to having their retirement budgets calculated. This includes 56% of GenXers, ages 38-53, 58% of Baby Boomers ...
Jun. 07, 2018
More than 6 in 10 Americans (61%) don’t know how much money they’ll need to save for retirement, according to a new study from Bankrate.com. The median amount among respondents who do have an estimate is $650,000. 19 million Americans say they never plan to retire, including 9% of both Millennials (18-37 year-olds) and Baby Boomers (54-72 year-olds).
Millennials are most likely to be unsure of how much money they’ll need in retirement (69%). However, older Americans aren’t much closer to having their retirement budgets calculated. This includes 56% of GenXers, ages 38-53, 58% of Baby Boomers and 59% of those ages 73+.
Respondents who have put some thought into the amount they need to save are mixed. 7% say $250,000 – $500,000 and 8% say either $250,000 or less, $500,000 – $1 million or over $1 million, respectively.
Gen Xers are twice as likely as any other age group to say they need over $1 million to retire. Those who are employed are nearly three times as likely to say they need this amount compared to unemployed respondents. And, people in the Northeast (12%) and West (11%) are about twice as likely to say $1 million versus residents of the Midwest (5%) and South (6%).
“The key to retirement savings is to actually save for retirement. Put away at least 10 percent of your pay, including any employer contributions, into your retirement account and do it yesterday,” said Bankrate analyst Taylor Tepper. “There are pretty sophisticated online calculators and tools that can help you estimate how much you’re going to need, and you can always hire a fee-only certified financial planner if you want a little more hand holding.”
More than half of Americans say they have sought advice on their retirement planning. 26% consulted a personal financial advisor, 21% asked a family member or friend, 11% used an online retirement calculator, 10% reached out to a bank or financial institution, 8% relied on expert commentary or articles and less than 1% used a roboadvisor.
Millennials are most likely to reach out to a family member or friend (30%). Whereas, Baby Boomers are most likely to consult a personal financial advisor (37%). People who are married or living with a partner are twice as likely to consult a personal financial advisor or bank/financial institution than those who are single or not living with a partner.
When asked how much of your retirement will be funded by Social Security, a whopping 61% said little to none. 20% said about half and 17% said that most to all their retirement money would come from Social Security.
Taylor added, “Social Security will almost certainly contribute a sizable portion of your retirement income, even for millennials, despite erroneous declarations that the pension program will soon go bankrupt.”
More on the study is available at: https://www.bankrate.com/retirement/survey-how-much-needed-to-retire/.
This study was conducted for Bankrate by GfK Custom Research North America on its OmniWeb online omnibus. The sample consists of 1,000 completed interviews, weighted to ensure accurate and reliable representation of the total population, 18 years and older. Fieldwork was undertaken May 11-23 and 18-20, 2018. The margin of error for total respondents is +/- 3%.