Retirement 2.0blog

Older boomers embrace retirement, study finds

Sixty percent of retired boomers said life is better than they had expected

Dec 6, 2017 @ 11:44 am

By Mary Beth Franklin

A funny thing happened on the way to retirement. For many boomers, fear of the unknown gave way to contentment once they got to the other side.

Six out of 10 retired boomers feel better than expected about their retirement, according to a new survey conducted by Capital Group, home of American Funds. The research analyzed the dynamics for boomer investors (age 53 to 71) as they transition into retirement.

In contrast, Americans who are still working—including younger boomers, Gen-Xers (ages 38-52) and Millennials (ages 21 to 37)—are twice as worried about having enough money for retirement as retired boomers. Six out of 10 Americans (59%) currently in the workforce say that not having enough money for retirement is one of their top financial concerns compared to 28% of retirees.

WORKING BOOMERS

In fact, the people who are most concerned about their ability to retire comfortably are boomers who are still working. Among boomers who are already retired, only 27% list having enough money for retirement as a top concern while 65% of those still working say it is.

Those results are consistent with a recent InvestmentNewscover story that documents how younger boomers face hurdles as they approach retirement compared to older members of their generation. A lack of pensions, higher college costs for children and care for aging parents are among the challenges that may keep not-yet-retired boomers from enjoying their golden years.

"Once folks do retire, the majority tell us they feel good about retirement even if they have less money than they had planned," said Heather Lord, strategy and innovation director for Capital Group.

Three quarters of retired Boomers said their financial situation was in line with or better than what they had expected at the time of retirement. More savings made for a more enjoyable retirement that includes travel experiences and the ability to help other family members financially.

ADJUSTED SPENDING

Less than a quarter—23%—of retired boomers said they saved less than they had hoped. Those who retired with less savings than expected had to adjust their spending. However, 37% say having less money has not affected their outlook on life and 26% said they have come to value family and friends more as a result of diminished financial resources.

However, even those retirees with sufficient savings said they were surprised by how much more they spent on health care and travel than they had expected. One third of retirees also said they were paying more in taxes than expected.

One of the most important pieces of advice that boomers offer younger investors: start saving for retirement early and often. That's one area where Millennials have their elders beat. Two-thirds of Millennials report that they began to care about investing in their 20s, more than three times the rate of Boomers. Only 19% of them started saving in their 20s. Gen-Xers fall somewhere in the middle with 29% reporting that they began investing in their 20s.

The research consisted of an online survey conducted in March 2017 of 1,200 American adults evenly divided among Boomers, Gen-Xers and Millennials. Of the boomers surveyed, 38% were retired and the rest were still working.

0
Comments

What do you think?

View comments

Recommended for you

RIA Data Center

Use InvestmentNews' RIA Data Center to filter and find key information on over 1,400 fee-only registered investment advisory firms.

Rank RIAs by

Featured video

Events

What's the top issue on advisers minds?

Laura Pierson from Carson Group discusses how the old topic of 'Human Capital' is hot again because of millennials.

Latest news & opinion

Best- and worst-performing sector funds and ETFs this year

A rising tide may lift all ships, but a bull market doesn't lift all stock sectors. Here are the best- and worst-performing sectors this year, with the top and bottom fund in each sector.

Betterment slapped with $400,000 fine from Finra

Robo-adviser cited for violating customer protection rule and not maintaining its books and records correctly.

Supreme Court ruling on SEC judges unlikely to upend advice industry

But it could give rise to new hearings for some advisers who are already in litigation with the agency such as Dawn Bennett.

It's official: DOL fiduciary rule is dead

The 5th Circuit Court of Appeals issued a mandate Thursday making its March 15 decision to strike down the regulation effective.

Advisor Group acquires Signator Investors and plans on folding it into Royal Alliance

Advisor Group takes 'orphan' broker-dealer off the hands of John Hancock Financial Services.

X

Hi! Glad you're here and we hope you like all the great work we do here at InvestmentNews. But what we do is expensive and is funded in part by our sponsors. So won't you show our sponsors a little love by whitelisting investmentnews.com? It'll help us continue to serve you.

Yes, show me how to whitelist investmentnews.com

Ad blocker detected. Please whitelist us or give premium a try.

X

Subscribe and Save 60%

Premium Access
Print + Digital

Learn more
Subscribe to Print