Why Retirement May Be Changing
CREDIT: Retirement Image via Shutterstock
Retirement as we know it may be a thing of the past. New research has found that 23 percent of Americans say they plan on never fully retiring, while an additional 25 percent say they plan on working part-time in retirement.
Overall, 54 percent of respondents plan to fully retire by age 65. However, nearly 40 percent of respondents are not contributing to a retirement plan and more than 26 percent say they are unsure of how much they need to retire.
Even though respondents say that they are not planning for retirement, 33 percent of Americans still say they are currently more confident in their ability to retire than they were one year ago. Just 23 percent of respondents say they are concerned about their ability to retire.
"Now more than ever, it is important for Americans to take their retirement plans into their own hands to ensure they have an adequate nest egg," said Dan Greenshields, president of Capital One ShareBuilder, Inc, an online brokerage which conducted the research. "While planning for a time that many see as a distant future can be a daunting task, people need to assess where they want and expect to be financially when they retire and take advantage of the various tools and resources available to plan for their financial future."
The researchers also found that a third of Americans are not looking to cut back spending at all while in retirement. Thirty-three percent say they plan to maintain their current lifestyle in retirement while 17 percent plan to make sacrifices when they retire. Thirty-eight percent say they are unsure of how much they need to save in retirement.
"At any point in life, events can come up where even the best laid financial plans can be derailed," Greenshields said. "Having an adequate emergency or rainy day fund will help ease the financial burden of unexpected costs – and help keep you on track for retirement."
Paying for college is the top challenge facing pre-retirees, the researchers found. Respondents also said that losing a job and paying normal household bills are the top challenges to saving for retirement. More than one-third of respondents say that nothing has impeded their ability to save for retirement.
The research was based on the responses of 1,000 adults over the age of 18.