While workers’ confidence in their ability to retire and at least pay for basic expenses has rebounded since the start of the recession, Americans clearly are not setting their expectations high enough.

Only 16% are very confident they will have a comfortable retirement, and less than a third, 29%, expect to have enough money to cover basic expenses. When asked about the ability to pay for medical expenses, only 12% think they will have enough, and when it comes to long-term care, only 10% expressed confidence.

Further, only 60% of Americans say that they and/or their spouse are saving for retirement, down from 65% in 2009, and only 69% report that they and/or their spouse have ever saved for retirement, down from 75%.

This is according to the Employee Benefit Research Institute and Mathew Greenwald & Associates 20th annual “2010 Retirement Confidence Survey: Confidence Stabilizing, But Preparations Continue to Erode.” This year’s survey, available in full at EBRI's website, was conducted in January via 20-minute telephone interviews with 1,153 individuals, 902 of whom are currently working and 251 of whom are retired.

Even more troubling, 27% have less than $1,000 in savings, up from 20%, and for 54%, the total value of their household’s savings and investments, excluding the value of their primary home and any defined benefit plans, is less than $25,000. Furthermore, less than half of workers, 46%, say they or their spouse have sat down and tried to calculate how much they will need in retirement.

It appears that the answer an increasing amount of people think will solve their retirement woes is simply working longer, with 33% expecting to retire after 65, up from 11% in 1991. But the reality is, nearly a third, 31%, of people are retiring before age 60, and another 30% are packing it in between the ages of 60 and 64. Only 12% actually remain in the workforce through age 65, with another 12% retiring between the ages of 66 and 69. A mere 8% keep their jobs through age 70 or older.

While expectations for the support of Social Security and pension plans are realistically tamping down (77% and 56%, respectively, down from 88% and 62% in 2005), more Americans, 75%, report they will rely on employer-sponsored retirement savings plans as the crux of their retirement strategy.

However, only 14% have purchased and 11% are likely to purchase a financial product or retirement plan option that pays them guaranteed income each month for the rest of their life.

Another key finding is that only 17% of workers are very confident in stocks as a sound investment, down from 28% who thought so in 2000. Retirees’ opinions mirror that, although slightly lower, with 14% calling stocks a sound investment, down from 25% seven a decade ago.

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