(FEDweek) - The latest annual “retirement confidence survey” found both workers and retirees feeling less sure they will have enough money to live on comfortably in retirement, with concern about inflation high among the reasons, says the Employee Benefit Research Institute.
“Workers worry that their salaries won’t keep up with inflation and report more debt, while retirees worry about cost of living and expenses,” said an announcement of the results. “Half of retirees report that their overall spending is higher than expected, an increase over last year’s one-third, and the share of retirees who feel their retirement lifestyle is worse than they expected is slowly growing.”
Compared with 2022, the share of workers being very or somewhat confident in their retirement savings fell from 73 to 64 percent, while the percentage among retirees fell from 77 to 73 percent. “The last time there was a decline in confidence of this magnitude was in 2008 during the global financial crisis,” it said.
It added: “Both workers and retirees report high concerns about inflation and its impact on their savings and spending. The effects of inflation are heavy on Americans’ minds, as 84 percent of workers and 67 percent of retirees are concerned that the increasing cost of living will make it harder for them to save money. Four in 10 workers and 3 in 10 retirees are not confident their money will be able to keep up with inflation in retirement, which is a significant increase compared with the third of workers who felt this way last year.”
Other main contributors to loss of confidence included rising debt levels among employees (that stayed the same among retirees, though), poor returns or losses in retirement savings accounts, and lower confidence in Medicare, with only half even at least somewhat confident it will continue to provide benefits equal to those of today.
By FEDweek
