Planning for retirement is stressful enough. Try bringing a pandemic into the mix.
Despite the uncertaintyspawned by the health crisis, baby boomers are confident they will have a successful retirement and their lifestyle will be everything they planned.
That’s according to a Charles Schwab survey, which found that 82% of boomers believe their savings will get them “all the way” or “most of the way” to living out their dreams in retirement.
The age group, aged 55 to 75, also believe their lifestyle will compare better than the generations before and after them.
Over 84% of boomers anticipate their quality of life in retirement will be better than that of their parents. More than 80% of boomers also believe their retirement will be better than their children’s.
Survey respondents have accumulated an average of $920,400 in retirement savings, and believe they need $135,100 per year on average to live their ideal life in retirement.
“The reality is that they [boomers] may come up short considering an average savings of $920,400 will only last about seven years at their expected spending rate,” said Rob Williams, vice president of Financial Planning at Charles Schwab. “The good news is that these boomers may have other sources of income like Social Security, but the only way retirees can be sure the math adds up is by putting pen to paper and having a plan in writing.”
The survey also points up differences in perspectives between people who have not yet retired, those who have been retired for less than five years and those retired five years or more.
More than 33% of aspiring retirees are more likely to plan to work in retirement, while only 2% of retirees plan to do so. Aspiring retirees are also expecting to retire later than those who have already retired.
On average, aspiring retirees plan to retire at age 66, while retirees hung it up at 59.
Over 19% of survey respondents say they or their spouse were financially impacted by COVID-19 through a salary cut or reduced hours.