Americans' confidence in their ability to retire appears to be stabilizing, now

that the economic volatility of the recession has abated, but their

self-described preparations for retirement continue to erode, according to the

2010 Retirement Confidence Survey (RCS) released this week by the Employee

Benefit Research Institute (EBRI).

However, the survey also finds that a growing number of American workers are

also planning to delay retirement -- which has negative implications for the

U.S. job market, where unemployment is high and layoffs continue to grow. As

older workers stay at their jobs longer, the RCS results suggest that fewer

existing jobs are likely to open up.

"Americans' attitudes toward retirement have clearly tracked the economy the

last couple of years, and that seems to be the case in 2010," said class=xn-person>Jack VanDerhei, EBRI research director and co-author of

the survey. "Unfortunately, while their attitudes are stabilizing, their

preparation for retirement is not. A distressing number of people have no

savings at all."

In addition to looking at long-term trends on workers pushing back their

expected retirement age -- which had been steadily growing even before the

recent economic recession -- this year's RCS also reveals several other major

trends that this unique survey has been tracking over the past two decades.

Among the survey's key points:

• Stabilizing confidence: The percentage of workers very

  confident about having enough money for a comfortable retirement remains steady

  at 16 percent, which is statistically equivalent to the 20- year low of 13

  percent measured in 2009.  Retiree confidence about having a financially

  secure retirement has also stabilized, with 19 percent saying now they are very

  confident (statistically equivalent to the 20 percent measured in 2009).

• Basic expenses: Worker confidence about paying for basic

  expenses in retirement has rebounded slightly, with 29 percent now saying they

  are very confident about having enough money to pay for basic expenses during

  retirement (up from 25 percent in 2009, but still down from 34 percent in 2008).

   The percentage of retirees indicating they are very confident about paying

  for basic expenses has stayed level at 33 percent (statistically equivalent to

  the 34 percent observed in 2009).

• Financial aspects of retirement: The percentages of workers

  very confident about other financial aspects of retirement have held steady at

  12 percent for medical expenses, 10 percent for long-term care expenses, and 21

  percent for doing a good job of preparing for retirement.  However, the

  percentages not confident continue to creep upward, from 44 percent in 2009 to

  51 percent in 2010 for medical expenses, from 56 percent to 61 percent for

  long-term care expenses, and from 30 per- cent to 35 percent for doing a good

  job of preparing for retirement.

• Fewer are saving: Fewer workers report that they and/or their

  spouse have saved for retirement (69 percent, down from 75 percent in 2009 but

  statistically equivalent to 72 percent in 2008). Moreover, fewer workers say

  that they and/or their spouse are currently saving for retirement (60 percent,

  down from 65 percent in 2009 but statistically equivalent to percentages

  measured in other years).

• Ranks of those with no savings are growing: An increased

  percentage of workers report they have virtually no savings and investments.

   Among RCS workers providing this type of information, 27 percent say they

  have less than $1,000 in savings (up from 20 percent

  in 2009).  In total, more than half of workers (54 percent) report that the

  total value of their household's savings and investments, excluding the value of

  their primary home and any defined benefit plans, is less than class=xn-money>$25,000.

• Workers postponing retirement: One-quarter of workers (24

  percent) report they have postponed their planned retirement age in the past

  year.  Among the reasons cited for delaying retirement are the poor economy

  (29 percent of those postponing retirement), a change in their employment

  situation (22 percent), inadequate finances (16 percent), and the need to make

  up for losses in the stock market (12 percent).

• Later retirement expected: Although the age at which workers

  report they expect to retire shows little change from 2009, a longer-term look

  finds significant change.  In particular, the percentage of workers who

  expect to retire after age 65 has increased over time, from 11 percent in 1991

  to 14 percent in 1995, 19 percent in 2000, 24 percent in 2005, and 33 percent in

  2010.

• Institutional confidence: Americans continue to lack

  confidence in institutions.  They are most likely to express confidence in

  private employers (23 percent of workers and 27 percent of retirees very

  confident) and least likely to feel confidence in the federal government (11

  percent of workers and 8 percent of retirees).  Just 19 percent of workers

  and 22 percent of retirees report they are very confident about banks, while 12

  percent of workers and 13 percent of retirees say they are very confident about

  insurance companies.  Moreover, the percentages of retirees somewhat

  confident about banks (45 percent, down from 51 percent in 2009), insurance

  companies (42 percent, down from  56 percent), and the federal government

  (30 percent, down from 45 percent) are declining.

• Clueless about savings goals: Many workers continue to be

  unaware of how much they need to save for retirement.  Less than half of

  workers (46 percent) report they and/or their spouse have tried to calculate how

  much money they will need to have saved by the time they retire so that they can

  live comfortably in retirement.

• Some reality testing on savings needs: The savings goals cited

  by workers who have done a retirement needs calculation have increased over

  time.  In the 2000 RCS, 31 percent said they needed to accumulate at least

  $500,000 for retirement.  This percentage

  gradually increased to 43 percent in 2005 and 54 percent in 2010.

• Investing confidence ticks up: Those who have saved for

  retirement have recovered some confidence in their ability to invest their

  savings wisely.  Thirty-two percent of workers indicate they are very

  confident (up from 24 percent in 2009) and another 54 percent are somewhat

  confident.  Retirees who have saved for retirement show a similar rebound

  in confidence that they are investing their savings wisely, with 82 percent

  saying they are very or somewhat confident (up from 70 percent in 2009).

• Sources of retirement income: Over time, the RCS has observed

  changes in workers' expected sources of retirement income.  In particular:

  fewer workers are expecting to receive retirement income from Social Security

  (77 percent, down from 88 percent in 1991) and defined benefit plans (56

  percent, down from 62 percent in 2005).  However, more workers report they

  will rely on employer-sponsored retirement savings plans (75 percent in 2010, up

  from 69 percent in 2005) and employment income (77 percent, up from 70 percent

  in 2005).

• Guaranteed income products: Few workers report they are likely

  to purchase a financial product or select a retirement plan option that pays

  them guaranteed income each month for the rest of their life.  Only 11

  percent indicate they are very likely to do so, while 35 percent say they are

  somewhat likely.  Only 14 percent of retirees report they purchased a

  guaranteed-income product or selected a guaranteed-income option from a

  retirement plan.

About the Survey

research institute based in Washington, DC, that

focuses on health, savings, retirement, and economic security issues. EBRI does

not lobby and does not take policy positions. target=_blank>www.ebri.org