Americans’ retirement expectations have changed dramatically in the past few years, with a vast majority planning to live more frugally and to delay retirement, SunAmerica Financial Group and Age Wave found in a survey of 1,001 people age 55 and older that was the basis for the “SunAmerica Retirement Re-Set Study.”
Nonetheless, a majority is still confident that they will be able to eventually retire.
“While the recession clearly had a financial and emotional impact, it was very encouraging to see that three out of five Americans 55 and older have remained hopeful for their future,” said SunAmerica Financial Group President and CEO Jay S. Wintrob. “Americans are emerging from the experience with new knowledge, new discipline and have re-set their vision of an ideal retirement.”
He added: “Americans have also proven themselves to be both resilient and resourceful.” Eighty-one percent said they have learned important lessons regarding retirement preparation in the past several years. “They are course-correcting, intending to work longer, save more, spend less, be more disciplined and adjust their lifestyle expectations,” Wintrob said.
SunAmerica found a significant shift in attitudes since it last conducted this survey with Age Wave in 2001.
Today, 54% view retirement as a new chapter in their life, rather than a winding down, compared to 38% in 2001 who viewed retirement as a new chapter.
Today, the average pre-retiree expects to retire at age 69, up from 64 in 2001.
Nearly two-thirds said they intend to continue working in retirement, and 65% said a combination of work and leisure is their ideal retirement.
And 82% say financial peace of mind is most important, compared to the 13% who cite accumulating wealth.
Nearly one-third said their portfolio has not returned to pre-recession levels, and 46% said their home is worth less now than before the recession.
Seventy-six percent said the last few years have been a wake-up call, and 84% now exercise more cautious investment strategies. Sixty-five percent want investments that are guaranteed not to lose value, and 60% seek to protect their income from market loss.
And 55% older Americans find themselves being pressed for financial assistance from other family members, be they aging relatives, adult children, grandchildren or siblings. Further, 70% expect that their adult children will need financial assistance.
“The financial services industry will be called upon to provide new solutions in retirement planning, as people are concerned about a need to plan financially not only for parents, but also adult children, grandchildren, siblings and in-laws,” Wintrob said.
“Emerging from the recession, Americans are beginning to define retirement differently than previous generations of retirees,” said Dr. Ken Dychtwald, Age Wave founder. “Having been jolted by the last several years, Americans have adopted more realistic and pragmatic views of the possibilities before them. They now see retirement as a time for new priorities, new opportunities and new strategies for today’s challenges.”
Dychtwald added: “Most Americans want increased flexibility in retirement, with the opportunity to move back and forth between periods of work and leisure. Seeking a more active and productive version of retirement than their parents’ generation, their main driver is the ability to stay engaged and stimulated in both work and new activities.”