Retirement Preparedness at Risk for Over Half of U.S. Adults
A recent study by the TIAA Institute and George Washington University has discovered that a significant portion of American adults lacks accurate knowledge about life expectancy rates which could jeopardize their retirement preparedness. They may not be properly prepared for the financial implications of living longer than expected.
According to the report, only 37% of survey respondents demonstrated strong longevity knowledge, while 28% admitted to having poor longevity knowledge, and 25% chose a response that underestimated life expectancy for a 60-year-old. Furthermore, 10% chose the response that overestimated life expectancy, indicating that a significant number of Americans could be working with inaccurate information.
According to GoBanking Rates, the survey found that 25% of adults who have not retired have not saved anything for their retirement, and only 40% of them think that they are saving enough for their retirement. The survey found that for non-retirees who are 60 years old and above, 13% of them do not have any retirement savings, while 48% of them feel that their retirement savings are not on the right track.
Recent findings from the TIAA-GWU study indicate that almost 60% of individuals who have retirement savings accounts but are not retired have low levels of comfort when it comes to investing their savings. The study also revealed that 32% of workers do not save for retirement regularly, and only 22% of those who are saving feel very confident that they are saving enough. Additionally, less than half of those who are saving for retirement have tried to figure out how much they need to save.
Interestingly, the TIAA-GWU study found that women have greater longevity literacy than men, with 43% of women demonstrating strong longevity knowledge, compared to 32% of men. This finding is significant given that financial literacy among women consistently lags that of men. Annamaria Lusardi, an economist at GWU and director of the school’s Global Financial Literacy Excellence Center, called this result “striking” and suggested that more help might be needed for women in dealing with their longer lifespans.
In conclusion, Americans need to improve their knowledge of life expectancy rates and the importance of saving for retirement. With more than half of U.S. adults lacking longevity literacy, there’s a risk that many could be jeopardizing their retirement preparedness. By increasing financial literacy and offering more education on retirement savings, Americans can better prepare themselves for a comfortable retirement.
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