Planning for Retirement in Today’s Economy
By Kim O’Brien, NAFA President & CEO
As millions of Baby Boomers begin to march toward the next chapter of their lives, many are uncertain whether they will have enough money to retire, and others know that they simply have not saved enough. But consumers can stem this anxiety by increasing their awareness about retirement planning options and preparedness, as well as deciding what retirement means for them. A financially secure future is still attainable for the millions of Americans planning for and nearing retirement.
A recent study found that views of retirement have shifted from 10 years ago:
- A new outlook: Today, 54% view retirement as a new chapter in life, rather than a winding down — a significant increase over the 38% that held a similar view a decade ago.
- Retirement is being postponed: Pre-retirees say they now intend to delay retirement by five years — from 64 to 69 — triggered in part by increasing longevity, as well as the recession and financial need.
- Retirement no longer means the end of work: Almost two-thirds say they would ideally like to remain productive and include some work in retirement to stay active and involved.
- Financial peace of mind is now six times more important than accumulating wealth: 82% name it their key financial goal.
- Unexpected multi-generational family assistance has become the new retirement wild card: Pre-retirees must balance their retirement plans with the possibility of having to support aging relatives, adult children, grandchildren and siblings. Nearly half of Americans 55 and older expect to provide this support, and in a new twist on childcare, 70% of those believe their adult children will need financial assistance.
Considering these shifting viewpoints, it is clear that in order to have a financially secure retirement, today’s workers are going to need to save more on their own for retirement than did today’s retirees. As they enter retirement, they are going to need to figure out the best way to turn that retirement savings into a reliable retirement income.
Indexed annuities are a wonderful product for people to consider as part of their retirement portfolio. They are the only products that allow individuals to accumulate retirement savings, protect those savings from market losses and turn those savings into a guaranteed income for life. Indexed annuities are specifically designed to protect and grow those retirement savings dollars and ultimately convert them into a steady stream of income.