Americans' confidence in their ability to afford a comfortable retirement has

dropped to its lowest level in seven years, reflecting worries about health

costs, the economy, and home values, according to the 18th annual Retirement

Confidence Survey® (RCS) released today.

Key findings from the survey include:

Overall retirement confidence drops sharply
The

percentage of workers very confident about having enough money for a comfortable

retirement decreased sharply, from 27 percent in 2007 to 18 percent in 2008, a

decline of 9 percentage points and the biggest one-year drop in the 18-year

history of the survey. Retiree confidence in having a financially secure

retirement has also decreased sharply, from 41 percent very confident to 29

percent, down 12 percentage points.

Health care costs have become a big issue for

retirees
Among retirees who left the work force earlier than

planned, more than half (54 percent) say they did so because of health problems

or disability. Almost half of retirees (44 percent) say they have spent more

than expected on health care expenses. More than half of retirees (54 percent)

say they are now more concerned about their financial future than they were

right after they retired, a 14 percentage-point increase from a year ago (40

percent in 2007).

Workers may be waking up to the lack of health insurance in

retirement
The RCS finds that 34 percent of all workers now expect

to have access to employer-paid health insurance in retirement, down 8

percentage points from last year (42 percent in 2007). Although 41 percent of

retirees say they currently have access to health insurance through a former

employer, many employers are eliminating health care coverage for future

retirees.

Retirement planning up, but still not high
Less than half

of workers (47 percent) say they and/or their spouse have tried to calculate how

much money they will need for a comfortable retirement, up from the 42 percent

measured in 2004--2006 and considerably higher than the low point of 29 percent

recorded in 1996. As before, the 2008 RCS finds that doing a retirement savings

calculation is particularly effective at changing worker behavior: 44 percent

who calculated a goal changed their retirement planning, and of those almost

two-thirds (59 percent) started saving or investing more.

Most savings levels are modest
The percentage of workers

(72 percent) saying they have saved for retirement has returned to 2001--2006

levels after a slight dip in 2007 (66 percent). Forty-nine percent of workers

report total savings and investments (not including the value of their primary

residence or any defined benefit plans) of less than $50,000. Twenty-two percent

of workers and 28 percent of retirees say they have no savings of any kind.

Source:  href="http://www.ebri.org/">size=1>http://www.ebri.org/