More than a decade after the Great Recession officially ended, retirement confidence levels finally have returned to the levels reached before it, according to the Employee Benefit Research Institute.
A survey found that 82 percent of retirees are confident in their ability to live comfortably through retirement, up from 75 percent a year ago and comparable to the level of 2005. “Furthermore, the percentage of workers who say they are very confident in their ability to live comfortably throughout retirement reached 23 percent, up from last year’s 17 percent and now reflect levels measured more consistently in the late 1990s and early 2000s, prior to the financial crisis of 2008,” it said.
“This year, retirees are also much more likely than last year to be confident in their ability to afford the lifestyle they are accustomed to (77 percent vs. 70 percent) and having enough money to last their entire life (76 percent vs. 67 percent). Eight in ten retirees indicate they are very or somewhat confident they will have enough money to take care of medical expenses, compared with 70 percent in 2018, and retirees are less likely than last year to say their overall expenses, health care expenses, and long-term care expenses are higher than they expected,” it said.
Among those still working, 67 percent feel confident that they will be able to retire comfortably–with 23 percent very confident, still 4 points below the high of 2007. However, workers are less confident than retirees regarding their ability to cover medical costs in retirement and 61 percent say that debt is a problem for them compared with 26 percent of retirees.
It added: “The most pronounced gap in retiree experience and worker expectation for retirement income sources remains working for pay in retirement. Three-quarters of workers believe work for pay will be a source of income in retirement and only a quarter of retirees actually receive income from work. It is risky for workers to assume they will be able to work into retirement when, for so many retirees, this has not been the case.”