Retirement Stresses

. July 31, 2018.
retirement

The 2018 Retirement Confidence Survey (“RCS”), a joint venture between the nonpartisan Employee Benefit Research Institute and research firm Greenwald & Associates, reveals that about two-thirds of Americans feel confident, or at least somewhat confident, in their ability to retire comfortably. Yet nearly the same number say that preparing for retirement makes them feel stressed.

You may think that these feelings arise because many have saved very little. Among respondents who are still working, 45 percent report that the total value of their household’s savings and investments, excluding the value of their primary home and any defined benefit pension plans, is less than $25,000. Nine percent report totals of $25,000 to $49,999, 11 percent have $50,000 to $99,999, 15 percent are at $100,000 to $249,999 and 21 percent have $250,000 or more.

But many of those who have saved very little don’t actually seem stressed. Clear-eyed about their priorities, they seem to know what they need to do. For those who have managed to accumulate some money, usually $100,000 or more, that is when the worries seem to start.

Uncertain futures

Perhaps the stress comes from not knowing or fearing what lies ahead. According to RCS, although so many are anxious about the future, a whopping 62 percent of workers have not actually calculated how much money they need to saved to live comfortably in retirement.

It’s hard to feel confident about reaching a goal when you have not established the goal or what your options might be for achieving that goal. Online retirement calculators encourage working the numbers and asking, “What am I so afraid of?”

For those worried that they will not have enough, doing nothing only makes the problem worse. Perhaps the process of projecting retirement needs means that it is actually time to figure how much you are spending right now. That calculation alone deters many from addressing their retirement needs. While for some, the retirement planning process conjures feelings of financial inadequacy.

Become enlightened

The retirement planning process can be enlightening and can help you plan a path forward, while also raising tough choices. You may find that to hit your goals, you need to either save more today, reduce your expenses during retirement or work longer. Each scenario has inherent upsides and downsides.

Saving more today sounds virtuous, but then “Who knows what will happen? I should live for today!” Reducing income needs in retirement is a possibility, but then there’s the risk that when you actually retire, it will be harder to downsize than you think.

Finally, working longer may sound like a great idea when you are 45, but 20 years in the future it might not be an option. The RCS found a startling disconnect in the survey between workers’ expectations about relying on income from work in retirement, compared to retirees’ actual experience: 68 percent of workers expect income from working to be either a major or a minor source of income in retirement, whereas only 26 percent of retirees say that this income is a major or minor source.

For most, the retirement planning process requires the need to get real about what you are willing to do today, in order to feel secure in the future. The answers are rarely simple, but doing nothing is the worst option.

Trending

Black Lives Matter: Resources for being informed about Black Lives Matter

The murder of George Floyd, on May 25, 2020, has shaken the world. We can no longer deny the devastating impact of racism and for many, a spark has been light. That spark pushes us to learn, become informed and challenge ourselves to do whatever we can to wipe out racism and make our country

Outdoor activities to enjoy in Toledo

It’s crucial for all of us to be mindful of safety as the world slowly begins to reopen, but we also ache to get out of the house. Luckily, the Toledo area offers a variety of enjoyable outdoor activities so you can combat cabin fever and COVID-19 at the same time. BIRD WATCHING Though the

Laura Zitzelberger: Decades of helping animals

Laura Zitzelberger recently stepped back from her role at Nature’s Nursery a bit. She’s been involved with Whitehouse, Ohio’s wildlife rehabilitation center since co-founding it in 1989 with her friend Deb Cooper. She’s worked as the Nursery’s Director of Operations since 2006. But now, Zitzelberger works remotely as she has a lung condition so must

Wood County Historical Center honored for Poor Farm exhibit

The Wood County Historical Center and Museum was recognized for an exhibit, For Comfort and Convenience: Public Charity in Ohio By Way of the Poor Farm. Named Best Exhibition Under $500,000 in the Award of Achievement categories, For Comfort and Convenience, a focal point of the Center’s 2019 season, was an examination of facilities in