How You Can Stop Worrying About Retirement

Close that gap.

Many anecdotes on the retirement savings gap focus on those who are far behind where they should be -- with meager savings in their accounts as they approach retirement age. But what about those who have been saving for retirement their whole lives? They should feel confident, shouldn't they?

But according to a recent study by Allianz Life, these people still feel behind on savings, and worry that if they don't catch up, they won't be able to have the comfortable retirement they have dreamed up.

These people, identified in the study as "Chasers", make up almost half (49%) of active retirement savers age 45-65, and they have a mean retirement portfolio of more than $400,000. That's no small feat. Yet, a majority (85%) of Chasers feel they have fallen behind where they should be in saving for retirement. The same percentage worry it will be too late for them to have a comfortable retirement if they don't increase their savings soon.

So why all the worry?

Perhaps it's that they have competing savings priorities and are trying to balance other expenses. It might be they that are scared of taking on additional risk so close to retirement. Or perhaps it's because Chasers tend to own a smaller range of financial products versus the other half of people who do feel confident in their retirement savings.

Let's dig deeper into some of these potential reasons, and uncover some solutions that may help alleviate these concerns.

You're Distracted By Other Savings Goals

It can certainly be challenging to prioritize saving for a retirement that seems a long way off, particularly while there are bills, car payments, mortgages, vacations funds, college tuition and other expenses that need your attention right now. In fact, 54% of Chasers say they simply have too many other expenses right now to be able to save for retirement in the way that they want to.

Building a budget may seem basic, but many households don't have a detailed, formal budget. But creating one can help lay out what total expenses are, and identify opportunities for savings.

Another easy way to improve retirement saving is to utilize your employer's 401(k) program. Even if you are getting closer to retirement, max out your contributions. This is particularly important if your employer offers a match. These contributions come directly out of your paycheck, so you won't even notice it and more importantly, won't be able to spend it.

You Don't Want the Risk of Investing in High Risk/High Reward Financial Products

Conventional wisdom says that those closer to retirement age shouldn't take on riskier investments, and 63% of Chasers say they can't take the risk of investing in high risk/high reward financial products. However, most feel that they would benefit from being able to invest so they can reap the benefits of potential gains, while also having some form of protection against volatility and loss.

There are a wide range of traditional, fixed-income solutions that can provide this sort of protection, such bond funds, exchange-traded funds, annuities, certificates of deposits and money-market funds.

Working with a financial professional can help you calibrate your risk tolerance and explore opportunities to grow your funds, while maintaining a level of protection.

You Feel Less Confident Because You Own Fewer Financial Products

One additional potential reason that Chasers might feel so far behind is that they tend to own a smaller range of financial products. Only 53% have an individual retirement account (IRA), and even fewer own individual stocks (35%), mutual funds (35%), have a pension (37%) or own an annuity (14%). The reasons for this apparent lack of diversification differ from one person to the next, but by keeping your eggs in one basket, so to speak, you're not giving your savings the opportunity to the grow to their maximum potential.

Consider the other group identified in the study, those that do feel confident in their savings. A full 70% own an IRA, and they also own individual stocks (56%), mutual funds (51%), have a pension (53%) or own an annuity (28%). Diversifying and spreading out their investments might be a factor as to why they feel more secure with their savings.

Even if you do feel behind in saving for retirement, there are tips and resources to help you make up ground, and working with a financial professional is often a good place to start. It's never too late to start making the changes needed to ensure you have a plan in place for a long and comfortable retirement.

By: Kelly LaVigne, vice president of Advanced markets, Allianz Life Insurance Company of North America.

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