A recent survey reveals that more workers are confident in their retirement income in 2013 than in 2009, but most are still worried about their long-term prospects–especially those 50 and older. From Pension Benefits:
Retirement confidence climbed between 2009 and 2013, and nearly one-quarter of employees are now Very confident’ of having enough income for the first 15 years of retirement. This reflects improving financial conditions over the past four years as employees have rebuilt their savings. When asked to assess their prospects 25 years after retiring, however, only 8% remain confident of a financially comfortable retirement.
Since the start of the financial crisis, confidence levels for workers age 50 and older have declined by 10 percentage points. In 2007, 34% were very confident of their ability to afford the first 15 years of retirement, compared with only 24% in 2013.
Workers with defined-benefit plans are more confident than those with defined-contribution plans. On the flip side, the prospect of benefit cuts worry workers in DB plans. From Pension Benefits:
Participants in defined benefit plans (DB) are 35% more likely to be satisfied with their finances than those with only a defined contribution (DC) plan.
Roughly half of DB plan participants (45%) are afraid their retirement plan might be cut and about one-third (36%) fear having to bear more investment risk in the future. And for DB plan participants who have recently undergone a cut to their retirement program, 70% fear more curtailments are on the horizon.
Another interesting trend: Workers are becoming more engaged with their retirement plans. From Pension Benefits:
Since 2010, employees have become more involved and interested in retirement planning. Slightly more than half of all employees review their retirement plans frequently. Sixty-three percent of DB plan participants track their savings carefully compared with 48% of DC-plan-only participants. Older and midcareer workers report greater engagement with retirement than younger workers and saving for retirement is their number one financial priority.
You can read the full survey results by clicking here (subscribers only).
The article is published in Pension Benefits.