How to boost your retirement confidence
The 2011 Retirement Confidence Survey (RCS), a research report from the Employee Benefit Research Institute (EBRI) Education and Research Fund, revealed the percentage of workers “not at all confident” about having enough money for a comfortable retirement grew from 22 percent in 2010 to 27 percent in 2011 — the highest level measured in the 21 years of the RCS.
One of the biggest underlying issues is that many workers continue to be unaware of how much they need to save for retirement. Only 42 percent report they and/or their spouse have tried to calculate how much money they will need to have saved by the time they retire so that they can live comfortably in retirement.
The truth is that it’s almost impossible to successfully reach a financial goal — like a comfortable retirement — if you don’t know what it will cost. For those who do take the time to find out, the results are impressive. The RCS showed:
· Twenty-five percent of workers who have done a calculation, compared with 10 percent of those who have not, estimate they need to accumulate at least $1 million for retirement.
· Those who think they need to accumulate at least $1 million in retirement savings are almost five times as likely as those who think they need less than $250,000 to be very confident (33 percent vs. 7 percent).
· Forty-four percent of workers who calculated a goal amount report having made changes to their retirement planning as a result. Most often, these workers say they started saving or investing more (59 percent).
For help assessing your financial situation and calculating how much money you’ll need for a comfortable retirement, consult a financial professional. He or she can work with you to set a specific savings goal and implement an action plan to help achieve it. Rest assured that the added confidence you gain about your financial future will be well worth the time.
To review a full version of the RCS report, visit www.ebri.org/surveys/rcs/2011/.
James C. Hanna, CFP®, MBA, Financial Advisor, Certified Financial Planner ™ practitioner. Advisor is licensed/registered to do business with U.S. residents only in the states of Kansas, Missouri, Colorado, Nebraska, Oklahoma, Texas and Indiana.
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