Recession Hits Affluent of Retirement Age
As baby boomers continue to reel from the recession, even the affluent admit that saving for retirement is a struggle.
Only 28% of affluent investors are highly confident that they can generate enough income in retirement to cover all of their expenses. In response, the average respondent is delaying retirement until 68, according to a study conducted by Market Strategies International.
The study, released Monday, revealed several drivers of this trend. The first was the demise of pensions. Among affluent investors in the study– who possess an average of $623,000 in investible assets – only 22% are relying on a pension as their primary source of retirement income. This is a steep drop from current retirees, 39% of whom are relying on a pension.
“Prior generations had steady jobs with pensions so there’s a certainty of collecting a paycheck each week,” said Michael Solari, principal at Solari Financial Planning. “Baby boomers have had to figure out how much to save, how to invest and how to budget expenses. Even if they do it right, there’s no guarantee that they’ll collect the same paycheck each week.”
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