Survey reveals surprising truths about retirement, happiness, and financial security
Do you need to be financially secure to be happy in retirement? A recent survey by the Transamerica Center for Retirement Studies revealed that nearly all retirees are happy and enjoying life, even though fewer than half of those surveyed are financially secure. The 2018 survey examined more than 50 markers to discover key truths about retirement, finances, and the quality of life enjoyed by today’s retirees.
More than 2,000 retirees were polled for TCRS’ latest survey, A Precarious Existence: How Today’s Retirees Are Financially Faring in Retirement. Participants answered questions about how and when they retired, income levels, Social Security, quality of life, and more. The study revealed some surprising truths about retirement income, health, and quality of life. It also illuminated the financial vulnerability that many seniors face. Working from these facts provides some valuable insights into steps pre-retirees can take now to ensure a more financially secure retirement.
Retirement and quality of life
First the good news: the study found that most retirees are enjoying their life in retirement. The study revealed that 91 percent of retirees are generally happy, and four out of ten of those surveyed say their enjoyment of life has increased since entering retirement. Good health and close relationships seem to have a greater impact on quality of life than finances. 71 percent of retirees report they are in good or excellent health, and 90 percent have a close relationship with family and/or friends. Some of the activities retirees are enjoying include spending more time with family and friends, pursuing hobbies, and travelling.
Financial security in retirement
Many retirees lack financial security. Retirees have an average annual income of $32,000, and 25 percent of retirees have less than $25,000 in annual income. Many retirees are still paying off household debt, and the average amount retirees have in savings is just $75,000. Fewer than half of retirees agree that their nest egg will last through retirement, although 67 percent say they are confident they can maintain a comfortable lifestyle in retirement.
Retirement and Social Security
Nine out of ten retirees collect Social Security during retirement. While 66 percent of retirees rely on Social Security as their primary income source in retirement, only 4 percent waited to collect until they reached the age of full benefits. The average age that those collecting Social Security started receiving benefits was 62, the earliest age that most workers can claim benefits.
Tips for financial planning for retirement
One of the main takeaways from the study is that financial planning for retirementneeds to improve. Acting on the insights that emerged from the study can help pre-retirees enjoy a higher standard of living and greater financial security in retirement.
- Start saving early
The average age retirees started saving for retirement was 40.Three out of four retirees wish they had saved more and saved more consistently, and Half of all retirees believe that they waited too long to concern themselves with saving and investing for retirement.
- Plan a retirement and Social Security strategy
Creating a retirement plan can help you avoid critical mistakes that decrease your standard of living. For instance, waiting for the right age to collect Social Security during retirementcan increase monthly benefits by more than 75 percent.
- Get help planning for retirement
Six out of ten retirees wished they had been more knowledgeable about retirement saving and investing. 34 percent say they should have relied more on outside experts to manage their retirement. A financial advisor can help you create a plan for retirement saving and advise you on Social Security and retirement strategies.Taking this step will help ensure you don’t overlook critical factors that could cause you to run out of money in retirement.
If you would like help saving for retirement or developing retirement and Social Security strategies, reach out to knowledgeable financial advisor Matt Logan at www.mattloganinc.com or call 336-540-9700. We can help you develop a retirement plan that includes smart Social Security strategies so you can enjoy a more secure retirement.
Matt Logan Inc. is an independent firm with Securities offered through Summit Brokerage Services, Inc., Member FINRA, SIPC. Advisory services offered through Summit Financial Group Inc., a Registered Investment Advisor. Summit Brokerage Services, Inc., its affiliates and Matt Logan Inc. do not give tax or legal advice. You should consult an experienced professional regarding the tax consequences of a specific transaction. These are the views of Matt Logan Inc, and not necessarily those of Summit Brokerage Services, Inc. and any of its affiliates and should not be construed as investment advice.