Regardless of political affiliation, large majorities of Americans believe the nation faces a retirement crisis and are largely supportive of state efforts to expand coverage, recent survey results show.
Findings contained in the National Institute on Retirement Security’s “Retirement Insecurity 2019: Americans’ Views of the Retirement Crisis” show that 70% of survey respondents say the average worker cannot save enough on their own to guarantee a secure retirement.
Another 65% say it’s likely they will have to work past retirement age to have enough money to retire, according to the study, which examines the views of working age Americans on their retirement prospects, savings options, federal and state policies, and public employee retirement plans.
As for what’s making it harder for Americans to prepare for retirement, respondents cited the rising cost of health care and long-term care as the leading factors:
- Rising cost of health care in retirement (74%)
- Rising cost of long-term care (66%)
- Salaries not increasing (61%)
- Increasing debt, such as student loans, housing or credit cards (57%)
- Living longer (57%)
- Fewer employer-provided pensions (56%)
In addition, nearly three-quarters (73%) of workers say they don’t have the financial skills to manage money in retirement. What’s more, nearly 80% of respondents say retirees don’t know enough about investing to ensure retirement savings last through retirement.
When asked what they would be willing to give up in exchange for a secure retirement, 61% of respondents are willing to sacrifice pay and nearly half (47%) are willing to sacrifice savings to buy guaranteed income in retirement.
Of the generations, Millennials were found to be the most worried about a financially secure retirement (72%) and were most willing to put away more money now for retirement (60%). More than half (54%) of Millennial respondents said they are willing to save 5% or more to help ensure a financially secure retirement, which is more than double the response for that level of savings from Baby Boomers and Gen Xers.
Federal vs. State
Survey respondents also believe the government plays an important role in helping workers prepare for retirement. At the same time, however, they believe that federal lawmakers do not understand their struggles.
According to the findings, 84% of respondents say policymakers in Washington have no idea how hard it is for workers to prepare for retirement and more than half agree that government needs to increase Social Security contributions from both employers and workers.
In contrast, respondents overwhelmingly support (71%) efforts by state lawmakers to expand access to retirement accounts for all workers. Moreover, 74% of respondents say they would participate in state retirement plans. And their view of key features of state-based retirement plans as highly favorable, especially the possibility of having portability (90%), monthly checks (90%) and higher returns (86%).
Conducted by Greenwald & Associates, information for the study was collected from online interviews between Jan. 7-16, 2019, with a total of 1,250 individuals aged 25 and older completing the survey.