Recent surveys suggest that Americans are feeling more optimistic about their retirement lives thanks to rising wages. (iStock)
Confidence among U.S. workers and retirees about their retirement prospects has not yet fully recovered from record lows hit in 2023, but it is slowly improving, according to a recent survey.
According to the Employee Benefits Institute and Greenwald Research, the majority of workers (68%) and 74% of retirees believe they will have enough money to live comfortably in retirement. investigationSurveys show that workers and retirees are feeling more optimistic about their retirement prospects as they have more confidence in their income.
Indeed, wage growth is currently outpacing inflation, according to the U.S. Census Bureau. 3.9% increase According to the Bureau of Labor Statistics, inflation rose 3.4% in the 12 months ending in April.
Inflation remains the leading cause of Americans’ lack of confidence, with 31% of workers and 40% of retirees who are worried about retirement citing inflation as the culprit. Additionally, 39% of workers and 27% of retirees cite lack of savings as a cause of their lack of confidence.
“Workers and retirees are concerned that changes made by the U.S. government to America’s retirement system could affect their retirement,” said Lisa Greenwald, CEO of Greenwald Research. “In fact, 79% of workers and 71% of retirees share this concern. The impact of inflation on retirement also remains a concern among workers and retirees.”
If you’re struggling to save for retirement in the current economy, consider paying off your high-interest debt with a low-interest personal loan, which could lower your monthly payments. Visit Credible to compare options from multiple lenders at once and choose the one that’s best for you.
Biden to give homebuyers $400 a month: State of the Union
Most rely on social security
About 88% of workers and 91% of retirees say they will rely on Social Security as a source of income in retirement, but 62% of retirees say Social Security is an important source of income, compared with 35% of workers who expect it to be an important source of income.
Workers will begin claiming benefits at the same age they plan to retire, on average: 65. Historically, 65 has been the median retirement age in the U.S., but this year, 28% more workers said they plan to retire at 65, according to the EBRI survey.
The Social Security Trust Fund will begin to run out of money by 2035, and seniors’ benefits are expected to be cut by 17 percent unless Congress acts to strengthen the program. Recent Reports The Ministry of Finance announced this.
“Congress can and should take steps, as it has done in the past on a bipartisan basis, to extend the financial strength of the Trust Fund into the foreseeable future,” said Social Security Administrator Martin O’Malley. “Closing the shortfall would provide relief to the more than 70 million Social Security beneficiaries, the 180 million workers who contribute to Social Security and their families, and the nation as a whole.”
If you’re preparing for retirement, you can also take out a personal loan to pay off debt at a low interest rate and save money every month. Visit Credible to find a personalized interest rate without impacting your credit score.
Homebuyers gain thousands of dollars as mortgage rates fall: Redfin
The workers estimated they would need $1.5 million to retire.
The survey found that workers need to save $1.5 million to live a comfortable retirement, but many are far from that goal: A third of workers say they have less than $50,000 saved and invested, and 14% have less than $1,000.
More than 4 million American adults will turn 65 this year, according to Northwestern Mutual. investigationYet, of the generations closest to retirement, only half of Baby Boomers (49%) and Gen Xers (48%) believe they are financially prepared to retire comfortably, and many expect they will likely live to run out of savings. Even more troubling, while many older Americans in both generations expect to be short of money in retirement, more than a third (37% and 38%, respectively) are not prepared for it.
“The ‘magic number’ for people to retire comfortably has exploded to an all-time high, and the gap between their goals and their progress has never been wider,” said Aditi Jhaveri Gokhale, chief strategy officer, head of institutional investing and president of retail investing at Northwestern Mutual. statement“Inflation is raising expectations for retirement savings, putting pressure on people to plan and be disciplined.”
If high-interest debt is preventing you from saving for retirement, consider paying it off with a low-interest personal loan. Visit Credible to find your personalized interest rate in minutes, without impacting your credit score.
High homeowners insurance premiums are scaring off Florida homebuyers, other states face same problem
Do you have a finance-related question but don’t know who to ask? Email a trusted money expert email address: Your question might be answered in Credible’s Money Expert column.
