In addition to feeling unprepared for their own retirement, older Americans are uncertain about their ability to help with college expenses for their children or long-term care costs for their aging parents. Those are a few of the findings from a report published this month by the Insured Retirement Institute (IRI).
This year marks the third time the institute has surveyed boomers regarding their retirement confidence, and each year confidence levels have dropped. This year's IRI report found that only 37 percent of boomers feel confident in their retirement preparations.
Boomers planning to work longer
Retirement confidence has been on the decline since 2011 when 44 percent of those surveyed were feeling confident. In addition, 61 percent don't believe their finances will get any better in the next five years.
Boomers who are already retired are feeling a little more confident than their working counterparts, but even retirees appear to be nervous about their future. Less than half of retired boomers -- 46 percent -- say they are confident in their ability to live comfortably in retirement. Among those still in the workforce, the number expressing confidence drops to 32 percent.
Perhaps in an effort to shore up their finances, more boomers say they are planning to delay their retirement. In 2011, only 11 percent of respondents said they expected to work until age 70. That number jumped to 18 percent for the 2013 survey. Overall, more than one in five boomers say they will be delaying their retirement.
It isn't just paying for retirement that has boomers nervous. The IRI study also found most of those surveyed question whether they will be able to pay for other pending expenses.
- 69 percent say they are not confident in their ability to pay children's college expenses
- 75 percent say they are not confident in their ability to pay their parent's long-term care expenses
Retirement coping strategies
However, the report isn't all bad news. The IRI found boomers who sought out professional help were more likely to feel confident about their future.
"The silver lining to this report is that boomers who work with a financial professional are much more confident in their retirement plans," said Cathy Weatherford, IRI CEO and president, in a written statement. "They also are more likely to have determined a retirement savings goal, more likely to have retirement savings, and more engaged with their retirement plans."
Of those who consulted with a financial advisor, 48 percent said they were very or extremely confident in their retirement preparation. For comparison, only 28 percent of those preparing for retirement on their own could say the same.
Boomers who consult with finance professionals also take more proactive steps to prepare for retirement. Virtually all of them, 94 percent, have retirement savings, and 71 percent have a savings goal. Meanwhile, only 64 percent of those working on their own have savings and a mere 34 percent have established a savings goal.
It should be noted that the IRI is a trade group that represents various financial professionals. Still, the results support a fairly non-controversial principle: Careful planning is a key part of feeling assured about retirement, and if you feel over your head in managing the process, there's nothing wrong with seeking help.