Most Americans aren’t ready for retirement and don’t want to talk about it: Study

Almost two out of every three Americans don’t feel as if they have enough money to last them through retirement, even as nearly the same portion has yet to reach out to an advisor to create a financial plan, according to a new study.

Retirement solutions provider Retirable released its first State of Retirement study Tuesday, shedding light on how more than 2,000 U.S. individuals nearing and in retirement plan to spend their time, money and resources. On the whole, the fintech company found that less than a third of those surveyed are seeking the guidance of a financial advisor despite having very low confidence in their retirement planning and savings.

Retirees are looking to maintain their lifestyles into their retirement years, with a minority of respondents expressing a desire to move, according to Retirable’s study. More than 3 in 5 (64%) of the survey’s respondents plan to maintain their present lifestyle through retirement. The study also showed that only about 1 in 8 (13%) plan to split their time between a vacation home and their main property, while only 8% plan to travel.

Despite these fairly aggressive spending plans, the majority of respondents aren’t feeling too confident about their retirement resources. The survey showed nearly two-thirds (63%) of respondents don’t feel as if they have enough money to last them through retirement or aren’t sure if they do; just 27% of respondents are confident their savings will last them through retirement.

Along those same unnerving lines, more than half (52%) of respondents are considering taking on part-time jobs, or are uncertain whether they will have to, and 4 in 10 (41%) of near retirees said they are confident in their month-to-month spending currently and as they move into retirement.

Moreover, even while those surveyed are overwhelmingly worried about their financial futures, the majority remain loathe to discuss their status or plans either with family members or an advisor. The study showed less than half (44%) of Americans have discussed retirement planning with their children — and only 15% plan to do so. More than two-thirds (67%) of respondents haven’t met with an advisor to create a financial plan, while less than one-third (31%) have, the study showed.

“Many pre-retirees have a lack of confidence when it comes to navigating their retirement journey,” Tyler End, CEO of Retirable, told InvestmentNews. “Our survey results tell this story and show the areas where pre-retirees and retirees alike both need the most support. Retirees who don’t feel confident are not alone, and certainly are not without available resources.”

Elsewhere, the study showed that, on average, male respondents currently have $367,125 saved for their retirement, while female respondents have $257,593. Nevertheless, female respondents still believe they will retire at 67 years of age, lower than their male counterparts with higher savings who believe they will retire at age 70.

The majority of respondents expect health care to be their largest expense during retirement, while a third (33%) anticipate mortgage payments or rent to be the largest expense, the study showed.

“For many clients, retirement is a heavy mental burden,” said Emily Lapp, chief operating officer at Tanner Creek Capital of Stifel Independent Advisors. “It’s difficult for them to grasp whether or not their savings are going to be sufficient to live comfortably in their later years.” 

“Sitting down with a professional to build and review investment plans specifically tailored to them can bring confidence along with a plan of action,” Lapp said. “Advisors can help clients with building income strategies over time to comfortably replace the steady income stream that a career provided, therefore leaving the person with the time to pursue their next stage in life.”