Workers expect their defined contribution plans to play a greater role in their retirement income than annuities.
WASHINGTON, D.C. – The Insured Retirement Institute (IRI) today released new research showing that few women across the Baby Boomer and Generation X (Gen X) cohorts are confident in achieving a financially secure retirement. The report found that many women are still facing financial challenges, which are impairing their retirement readiness and outlook. Overall, only 30 percent of Boomer women and 13 percent of Gen X women have high levels of confidence in accumulating sufficient savings to live comfortably throughout their retirement years.
“Until we see more women feeling better about their household finances and the economy, we do not expect to see high levels of confidence in retirement prospects,” IRI President and CEO Cathy Weatherford said. “More women have stopped contributing to their retirement accounts than have increased their contributions. This is not a recipe for retirement security. Similarly, we know that working with a financial advisor generally leads to better savings behaviors and better outcomes, yet the majority of women have not consulted with a financial professional.”
The economy has had a detrimental effect on Gen X women: 35 percent have experienced difficulties paying their rent or mortgage, 19 percent stopped contributing to a retirement account, and 13 percent prematurely withdrew funds from a retirement account. Boomer women also have been affected, although to a lesser extent: 21 percent experienced difficulties paying their rent or mortgage, 17 percent stopped contributing a retirement account, and nine percent prematurely withdrew retirement savings. Furthermore, a quarter of Boomer women and 16 percent of Gen X women postponed their plans to retire as a result of the economy.
Other key findings from the report:
· Nearly one in five Boomer women and 35 percent of Gen X women do not have any savings for retirement. Of Gen X women with retirement savings, 44 percent have savings of $50,000 or less.
· One in five Boomer women and more than a quarter of Gen X women are unsure of when they will retire.
· About half of Boomer women plan to retire after age 65, including 29 percent who plan to retire at age 70 or later. Conversely, 43 percent of Gen X women plan to retire at or before age 65.
· More than half of Boomer women and three in four Gen X women have not consulted a financial professional about retirement planning.
The IRI study is based on three surveys of American women conducted during the past 14 months. The report was released during an event on Capitol Hill.
The entire report, “Baby Boomer and Gen X Women,” is available HERE.
About the Insured Retirement Institute: The Insured Retirement Institute (IRI) is the leading association for the retirement income industry. IRI proudly leads a national consumer coalition of more than 30 organizations, and is the only association that represents the entire supply chain of insured retirement strategies. IRI members are the major insurers, asset managers, broker-dealers/distributors, and 150,000 financial professionals. As a not-for-profit organization, IRI provides an objective forum for communication and education, and advocates for the sustainable retirement solutions Americans need to help achieve a secure and dignified retirement. Learn more at www.irionline.org.