Every year, the Employee Benefit Research Institute conducts research called the Retirement Confidence Survey. A total of 1,000 Americans 25 years and older are polled in order to determine self-reported behavior patterns and key attitudes and then compared to the data gathered in previous years in order to determine just how confident Americans are feeling when it comes to the prospects of their retirement income.
The EBRI recently finished its 2015 RCS and has released its findings. While the previous RCS reports from 2009 and 2013 featured record lows in American retirement confidence, figures from last year were on the increase; here’s what the 2015 RCS found this year.
Increases in Comfortable Retirement Confidence
According to the 2015 RCS, the number of individuals surveyed who said they felt “very confident” that they would be able to live a comfortable life once they retired now stands at 22 percent. While this number might seem on the low side looking at it without any context, this represents an increase of four percentage points over 2014’s 18 percent figure – and an even bigger jump when viewed through the lens of the year before. In fact, only 13 percent of survey respondents said they were very comfortable in 2013, showing a welcome upwards trend.
Additionally, confidence among retirees has also gone up, with 37 percent of those surveyed remarking that they were very confident as well in regards to having sufficient money to live a comfortable life during their retirement. This is a jump of nearly 10 percentage points from 2014’s 27 percent figure and a full 20 percentage points higher than the 18 percent of respondents who were very confident in 2013.
The Relationship between Confidence and Having a Retirement Plan
The EBRI also reported that when it comes to overall levels of confidence it found that having a solid retirement plan was the biggest indicator of high confidence in this year’s RCS. Respondents with a retirement plan in place or with a spouse that had a retirement plan were found to be more than two times as likely to be very confident in their futures as those who admitted to not having a plan.
The 2015 RCS also found that the biggest jump in the number of very confident Americans occurred in respondents with a plan set for their retirement – jumping from 14 percent in 2013 to a whopping 28 percent this year. However, the same was not true for those without a plan in place; in fact, between 2013 and 2015, the percentages of those without a plan who categorized themselves as very confident remained statistically unchanged.
If nothing else, this year’s results indicate just how important financial planning for retirement is. Based on the last several years’ worth of EBRI reports, having a retirement plan is a key indicator of how confident Americans are when it comes to their retirement and there are few indications that this will change any time soon – while confidence numbers are still low overall, the influence that retirement planning has on these figures is undeniable and presents a strong case for beginning your own retirement plan now if you haven’t done so already.
There’s no telling what the future holds, as the economy is fickle and we’re as likely to enter a new economic boom as we are to encounter a financial bust. However, one thing does remain clear – it’s a very good idea to plan for your retirement beginning immediately if you want to be confident that you’ll have enough to live on when it comes time to retire.