Outliving one’s money in retirement is a concern for affluent Americans, too.
A study by Market Strategies International reveals that the expected retirement age among affluent pre-retirees in the U.S. has gone up to 68—eight years higher than the actual retirement age reported by those already in retirement.
One factor driving this delay is an overall lack of confidence among pre-retirees (non-retirees 55 years or older) in their ability to meet all of their retirement income needs.
According to the report, only 28% of pre-retirees are highly confident in their ability to generate a suitable income in retirement to cover all of their needs. By contrast, nearly half (48%) of retirees are confident in their ability to do so.
“We see over one-third of all affluent Americans expressing serious concerns about either outliving their money or not being able to handle unexpected costs,” said Julia Johnston-Ketterer, senior director at Market Strategies International and author of the report. “These legitimate fears, coupled with increasing longevity, are pushing even affluent Americans to remain in the workforce longer.”
Other important factors at play—and the major differences between retirees and pre-retirees—are the anticipated sources of retirement income. For example, pre-retirees are three times more likely to rank a 401(k) as their No. 1 source of anticipated retirement income (25% versus 7%). Conversely, retirees are almost twice as likely to cite a pension as their No. 1 retirement income source (39% versus 22%).
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