October 30, 2010 — Americans might be justified in being envious of the French, who are taking to the streets to protest the raising of their retirement age from 60 to 62. Here in the states, the Sun Life Unretirement(SM) Index indicates that just as many Americans expect to retire at 70 as do 65. More than half more the working Americans responding to Sun Life’s recent survey (52%) expect to work at least three years longer than originally planned. Whereas in previous years the reason for working longer was “to stay mentally engaged”, “to earn enough money to live well” is cited just as frequently now.
Confidence continues to fall
At Topretirements we continue to see a steady stream of financial concerns relating to retirement, and these were well evident in the Sun Life Survey. Whereas just one year ago 64% of American workers believed they will need at least three years to rebuild their retirement savings as a result of the economic crisis — this year that ratio jumped to more than 8 in 10.
Sun Life’s ongoing research also shows that since the onset of the financial crisis in the fall of 2008, there remains a lack of confidence in the country about what retirement holds for Americans. Less than half of respondents (42%) are very confident that they will now be able to take care of basic living expenses in retirement. Only one in four have strong confidence that they will be able to take care of medical expenses. Just under 20% believe they will never fully rebuild from their financial losses. Younger Americans are even more pessimistic than older Americans. Those in their 30’s expect to have to work at least 10 years longer than they had originally planned.
Running out of money feared greater than death
These results are similar to those found in a survey conducted by Allianz Life. That study found that 61 percent of Boomers fear outliving their money in retirement more than death. Ironically, nearly one third (31 percent) say they are not too clear about what their expenses will be in retirement and 36 percent have no idea if their income will last.
Unretirement is defined as working at least 20 hours per week after the age when one is eligible to receive Social Security benefits. Sun Life created this Index to learn more about the reasons why Americans are choosing to “unretire,” or continue to work full- or part-time after the age of traditional retirement.
Growing concern, lower confidence about the future of government benefits
Over its two-year history, the Unretirement Index has charted increasing pessimism by American workers, since the onset of the economic crisis, that they will receive benefits upon retirement. The number of those polled who are confident that they will receive retirement benefits at a level comparable with today’s retirees reached a new low for programs including Social Security, Medicare, medical benefits from an employer, and government prescription drug benefits.
You can take the Sun Life Unretirement Index and find out what your Unretirement Index number is and what it means.
What do you think – is 70 your new 65?
Use the Comments section below to share your retirement expectations.