Are You Ready for Retirement?

August 3, 2017
  

43% of Americans inaccurately assess their retirement readiness—either worrying too much, or not enough.

  

Households increasingly face greater responsibility for their own retirement security. Fewer households will receive guaranteed lifetime income from traditional pension plans, and employer-sponsored retiree healthcare coverage is becoming far less common. Increases in Social Security’s Full Retirement Age are being phased in, resulting in a reduction in these benefits as well. In light of these trends, it is critical to regularly assess retirement preparedness and take action to stay on track, if needed.

Do You Have a Good Sense of Your Retirement Readiness?

 

Is Unaware of Shortcomings

19 percent of households are in danger of falling far short of where they expect to be in retirement, incorrectly believing they are on the right track.

 

Are Wrong about What They Think

43 percent of households incorrectly predict their retirement readiness. Most are actually in better shape than they believe and unnecessarily living in fear for their financial futures. Correctly understanding whether you will be able to maintain your standard of living in retirement is an important step toward achieving financial wellness.

Accurately Assessing Retirement Preparedness Is Key to Financial Wellness


Unaware of Shortcomings

Nearly one in five households incorrectly believe they will be secure in retirement. They face the biggest risk of being shocked by reality when they fall short.


On the Right Path

Nearly a quarter of American households are taking the right steps and correctly understand that their goals are within reach.


Unprepared for the Future

Over half of American households are at risk of not having enough money in retirement, but only a third are also aware they have work to do.


Overly Worried

The sky is not actually falling for the one in four households who worry, even though they are on the right track for retirement.



Taking advantage of financial wellness programs offered by employers can help put households on the path to becoming financially well. These programs include benefits that complement traditional benefit offerings with education, tools, advice, and solutions that focus on foundational financial issues. Through this combination of capabilities, financial wellness programs can help households take the important first step of self-assessing financial health, and then take the proper next steps to improve their condition.

Read Planning for Retirement: From Awareness to Wellness to learn more about how well households are self-assessing their retirement preparedness.




Source: Prudential's Awareness to Wellness, February 2017.

 

0307888-00001-00 Ed. 08/2017