As we celebrate Independence Day later this week, we thought it was a good time to stop and think about what freedom might mean to us — especially when it comes to money.
We’ve put together a brief survey to help us understand our collective relationship with money and what it means to be “financially free.”
Take the survey
We’d love to have you take the survey today and we’ll publish the results here, on our blog.
At Financial Engines, we are in the retirement savings business – so we talk about retirement all the time. But we notice when we start saying that word to people outside our business, we get a variety of reactions. Because of this, we’d love to get your reaction to retirement and invite you to take our quick survey.
How do you react when you hear the word retirement?
It’s one of those things we think about, know is eventually coming, and experience with our parents or friends, but for some reason, it’s often a concept that’s hard to apply to ourselves. And because of this, it might be one of the reasons that saving for retirement can be so challenging.
So we’d love you to tell us your experience – take the survey.
Then subscribe to this blog and we’ll publish the results in an upcoming post. In the meantime, if you’d like to learn more about retirement (because we know now you want to know more about that word!), we have a few articles that might interest you.
How Savings Becomes Income in Retirement
So You Can’t Afford to Retire: Now What?
Try Our New Social Security Planner Featured in the Wall Street Journal!
The Psychology of Saving Money – Research Reveals Financial Mind Tricks
Even with the stock markets at historic highs and the national economy sputtering back to life, more workers than ever lack the confidence they will have enough money to retire comfortably, according to the latest Retirement Confidence Survey released last week by the Employment Benefit Research Institute (EBRI). Twenty-eight percent of workers (up from 23 percent a year ago) share this dim view of their retirement future – the highest percentage tallied in an EBRI survey since 2011.
According to the survey, there are a lot of factors conspiring against us: We’re living longer and saving less in the face of pressing financial obligations and debt. Low interest rates make it harder to catch up. Companies are downsizing, requiring us to leave the full-time work force earlier than we plan. We have increased health spending. Pensions aren’t what they used to be (and there are fewer of them available) or we haven’t been contributing to our 401(k) or other retirement accounts, like IRAs.
It’s no wonder that workers are so pessimistic about the future.
Estimating how much income you will need in retirement in complex and can be challenging. While many workers and retirees are nervous about the future, as EBRI’s data suggests, most continue to go it alone. Just 23 percent of workers (and 28 percent of retirees) report they have obtained investment advice from a professional financial advisor who was paid through fees or commissions. Of these workers, 27 percent followed all of the advice, but more disregarded some of it and followed most (41 percent) or some (27 percent), according to EBRI.
The truth is, most people may not be equipped to manage today’s financial complexities – let alone tomorrows’ uncertainties. There’s market risk, longevity risk and health risks. And people have more financial pieces in more places than ever – 401(k)s, IRA, Roth, ETFs, HSAs, personal savings and more.
EBRI’s survey results reinforce the magnitude of the national retirement crisis. But individuals do have the power to change their outcomes for this new retirement. Taking action is the first step.
People interested in the latest news and offerings from Financial Engines can follow us on Twitter at @retirewell, on YouTube and via LinkedIn.