Retirement Preparedness Requires Course Corrections
Americans are feeling unprepared for retirement but are willing to take steps to ensure more financial security later in life.
February 15, 2017 | by Rebecca Moore | PLANSPONSOR
While most Americans realize retirement will be the biggest purchase of their lifetime—costing 2.5 times the cost of an average home—81% say they do not know how much money they will need to fund their retirement, according to a study from Bank of America Merrill Lynch, in partnership with Age Wave.
While most people say they want to live to the age of 90, only 27% of pre-retirees age 50 and older feel financially prepared to fund a retirement that lasts 10 years, let alone 20 to 30 years. The study found Americans are saving only a fraction of what they think they should: 5.5% vs. 25% of their annual income (after taxes).
More than half of Millennials feel a secure retirement is beyond reach, compared to 30% of Baby Boomers who feel this way. And Millennials expect 65% of their retirement income to come from personal sources, including savings and continued employment, far more than earlier generations.
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