A new study has found that workers and retirees in general are getting more confident in their ability to fund a comfortable retirement, but that feeling is far from universal and many workers still are not saving enough.
The annual report by the Employee Benefit Research Institute found that after a five-year dip, both workers and retirees are feeling more confident about their retirement, although the higher confidence among workers is strongly correlated to having a higher income and having a retirement plan such as an IRA. Among retirees, 28 percent are very confident, up from 18 percent in 2013, although 17 percent are not at all confident, up from 14 percent in 2013.
On the downside: 58 percent of workers and 44 percent of retirees report having a problem with their level of debt, and 24 17 percent, respectively, said their debt is higher than it was five years ago.
Also, 36 percent of workers said they have less than $1,000 saved from retirement, up from 28 percent over a year, and of those who have saved for retirement, 38 percent report savings of less than $25,000.
The report said that among workers, “only 44 percent report they and/or their spouse have tried to calculate how much money they will need to have saved by the time they retire so that they can live comfortably in retirement, a level that has held relatively consistent over the past decade. Workers who have done a retirement savings needs calculation (compared with those who have not) tend to have higher levels of savings.”
In addition, workers may be misleading themselves into thinking they will be able to supplement their retirement income with paid work. While 65 percent of workers have that expectation, just 27 percent of retirees actually do work for pay in retirement.