Originally posted March 18, 2014 by Michael Giardina on??http://ebn.benefitnews.com
Retirement confidence among Americans regained some of the losses reported??over the past five years????? where approximately 18% are very confident and 37% are somewhat confident with the future financial needs ??? according to a new survey from the Employee Benefit Research Institute.
In its 24th??installment, the EBRI annual Retirement Confidence Survey states that there was a 5% point jump in Americans workers who reported they were very confident and there was no statistical change among the population that were not at all confident at 24%.
Last year, 21%??reported that they were not too confident??and 28% – the highest level in the survey???s history ??? are not at all confident about the future needs of a comfortable retirement. 2013???s lowly sentiment also resonated with the very confident and somewhat confident, which reported 13% and 38% markers, respectively.
The Washington, D.C.-based nonpartisan, nonprofit research organization states that there was a 10% jump in worker confidence with a retirement plan who report being very confident at 24%. For the cohort without a retirement plan, the very confident level dipped down one percentage point to 9%.
???Retirement confidence is strongly related to retirement plan participation,??? says Jack VanDerhi, EBRI research director and co-author of the 2014 report. ???In fact, workers reporting that they or their spouse have money in a defined contribution plan or IRA or have a defined benefit plan from a current or previous employer are more than twice as likely as those without any of these plans to be very confident.???
The findings indicate that 1 in 10 of participant households currently enrolled in a retirement plan were listed as being not at all confident. At the same time, half of respondents without a retirement plan reported the same confidence level.
While 64% of workers report that they or their spouses have saved for retirement ??? a statistically equivalent figure to 2013 ??? 90% of workers currently signed up to a retirement plan list they have saved for their future income needs when they exit the workforce.
Also, retiree confidence, typically higher than worker confidence levels, continues to climb in 2014. Twenty-eight percent felt were very confidence in their financial security, a 10% jump from 2013.
Roughly??half of participants state that financial hurdles??such as the cost-of-living and daily expenses ??? as well as lingering debt ??? hinder worker savings.
???Just three percent of workers who describe their debt as a major problem say they are very confident about having enough money to live comfortably throughout retirement, compared with 29 percent of workers who indicate debt is not a problem,??? says Matt Greenwald, of Greenwald & Associates, which conducted and co-sponsored the survey.
During??America Saves Week??earlier this year, Dallas L. Salisbury, president and chief executive officer of the EBRI and chairman of the American Savings Education Council, highlighted that employers can assist with the current savings epidemic. Salisbury explained that workers who conducted retirement-needs calculation were more confident to save what is needed for retirement. Complementing this goal, he says that the theme for this year???s America Saves Week is ???to set a goal, to make a??plan and to save automatically.???
Other findings of this year???s RCS:
- Workers acknowledge the need for savings: Approximately 22% of the sample believes that they need to save between 20-29% of their income and another 22% believe that 30% of income is warranted.
- Estimating retirement savings needs is still unpopular: Roughly 44% state that they and/or their spouse have participated in this calculation.
- Financial advice is even less popular and falls on deaf ears: one in five workers and 25% of retirees report they have sought the help of a financial adviser; Only 27% of workers and 38% of retirees say they used all of the professional???s financial advice.