Nearly a third of Americans agree that running out of money in retirement is their top concern, according to a new study.
Franklin Templeton Distributors Inc., San Mateo, Calif., published this finding in a new Retirement Income Strategies and Expectations (RISE) survey. The September online poll surveyed 2,046 adults comprising 1,020 men and 1,026 women 18 years of age or older.
The report finds that almost a third (31%) of Americans agree that running out of money is their top concern in retirement. And almost half of all respondents (47%) would keep working if they were unable to retire as planned.
Respondents indicated that their next most pressing retirement concerns, after running out of money, were healthcare expenses (27%) and changes to Social Security that could lead to a reduction or delay in benefits (15%).
Top concerns, however, varied by age range. Among those of traditional retirement age (65 or older), medical expenses (29%) and changes to Social Security (22%) topped the list of concerns, followed by running out of money (19%).
The survey found also that more than three-quarters (78%) of 35- to 44-year-olds are concerned about managing their retirement income to meet retirement expenses—the highest percentage among any age group. While still a majority, this percentage decreases for younger age groups: 25- to 34-year-olds at 68% and 18- to 24-year-olds at 59%.
“What the survey brings into focus is that Americans have differing views on expectations, timeframes and concerns surrounding retirement, especially among various age groups,” says David McSpadden, senior vice president of Global Advisory Services for Franklin Templeton Investments. “For example, when asked where most of their retirement income will come from, the top choice for those ages 18 to 44 was a 401(k) or other individually funded workplace plan.
For those 45 and over, it was Social Security. This indicates that younger individuals increasingly realize the need to take control of their retirement income needs.”
Survey data also showed that while 41 percent of 35- to 44-year-old respondents are invested in a workplace retirement plan, a third (34%) of respondents in that age group said they haven’t thought about their approach to employing different sources of retirement income. And less than a quarter (23%) currently work with a financial advisor.
A quarter (25 percent) of respondents between the ages of 18 and 24 plan to rely on Social Security as a primary means of income during retirement. And 26% believe a workplace retirement fund, such as a 401(k) or 403(b), will provide the most income during their retirement.