Thursday, July 23, 2015

Ready to Retire?


The June 1, 2015 Wall Street Journal (pg. R5) quoted information from the 2015 Retirement Confidence Survey by the Employee Benefit Research Institute. The survey, released in April, 2015, provided some interesting information about how Americans felt about retirement. Some items discussed include the following (based on responses from individuals age 55 or older):

 
Planning

 
The percentages below show how many of the individuals polled:

  1. Have a written or documented financial plan- 21%
  2. Consulted a professional financial advisor- 43%
  3. Estimated health care costs in retirement- 36%
  4. Estimated their income needs in retirement- 58%
  5. Estimated how much they will need in savings as they begin retirement- 58%
Retirement Savings

The retirement savings issue warrants further discussion. More than half of the survey respondents believe they will need at least $250,000 in savings when they retire: only 25% have attained that level of savings. As a result, 67% expect to work in retirement. Only 23% of current retirees are working for pay.

Current savings levels prior to retirement showed some concerning results:

 Current Savings                                          Percent
Less than $1000                                           21
$1000-$9999                                                11
$10,000-$24,999                                          11
$25,000-$49,999                                          9
$50,000-$99,999                                          9

Current Savings                                           Percent
$100,000-$249,999                                     14
$250,000 or more                                        25

Note: These results are based on an Employee Benefit Research Institute telephone survey of 295 workers age 55 or older conducted in Jan-Feb 2015. The values exclude the value of a primary residence and assets in a pension (defined benefit) plan.

How does your retirement planning compare? We, at Paragon Financial Advisors, assist our clients in answering that question. Paragon Financial Advisors is a fee-only registered investment advisory company located in College Station, Texas. We offer financial planning and investment management.

 
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