More Americans are worried about their ability to afford a comfortable retirement, according to the annual Retirement Confidence Survey conducted by the Employee Benefit Research Institute. A few of the findings include: 

• More anxiety: Confidence levels have dropped to their lowest in seven years, reflecting worries about health costs, the economy, and home values, EBRI finds. Anxieties rose across all ages and income levels — but were particularly acute among younger and lower-income workers.  

• The percentage of workers who reported being “very confident” about having enough money for a comfortable retirement decreased sharply, to 18 percent in 2008 from 27 percent in the prior year — the biggest one-year drop in the 18-year history of the survey. Retirees are also feeling shaky – with just 29 percent feeling confidence about their financial security in 2008, down from 41 percent in 2007.   

• Growing health-care concerns: Among retirees who left the work force earlier than planned, more than half (54 percent) say they did so because of health problems or disability. Some 44 percent of retirees say they have spent more than expected on health care expenses. More than half of retirees (54 percent) say they are now more concerned about their financial future than they were right after they retired, up from 40 percent a year ago. 

• More are planning for retirement: Some 47 percent of workers say they and/or their spouse have tried to calculate how much money they will need for a comfortable retirement, up from the 42 percent in 2004–2006. The study found that doing a retirement savings calculation is particularly effective at changing worker behavior: 44 percent who calculated a goal changed their retirement planning, and of those almost two-thirds (59 percent) started saving or investing more. (Dartmouth economist Annamaria Lusardi has also found that people who at least try to plan for retirement ultimately end up with more than those who don’t.) 

• Savings levels remain modest: Some 72 percent of workers say they have saved for retirement. Nearly half report total savings and investments (not including the value of their primary residence or any defined benefit plans) of less than $50,000. Twenty-two percent of workers and 28 percent of retirees say they have no savings of any kind.  

You have until next Tuesday, April 15, to contribute to an individual retirement account (IRA) for the 2007 tax year. Get going.   

• Spend More in Retirement? Or less?
• The Rules of Engagement on the Job
• Why It’s Harder to Make Ends Meet
• Understanding Flexible Spending Accounts
• Building Financial Confidence

This entry was posted on Wednesday, April 9th, 2008 at 1:44 pm and is filed under IRA, investing, retirement, saving, setting goals. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.