Even for the most prepared, the prospect of retirement can be daunting.
There can be a nagging sense that you need to do more — and that it’s getting harder to retire safely. That feeling is backed up by new research from the Insured Retirement Institute and conducted in partnership with two life insurance companies.
The IRI surveyed 2,000 people, evenly split between current retirees and workers within 15 years of retirement, about how secure their retirement feels.
Among many other topics, the survey asked what would give retirees and near-retirees more peace of mind. Following are the top responses.
7. A second career
Respondents who said this would make them feel more secure about their retirement: 9%
This response was slightly more popular among near-retirees. In addition to a source of income that doesn’t draw down your limited resources, being able to continue working offers the opportunity for something fresh or flexible and other benefits that we highlight in “5 Reasons You Should Work for as Long as You Live.”
6. More money for heirs
Respondents who said this would make them feel more secure about their retirement: 20%
One in 5 respondents are concerned about what they’ll leave behind for those they love. That requires careful planning and the right documentation. Check out “8 Documents That Are Essential to Planning Your Estate.”
5. Better health insurance
Respondents who said this would make them feel more secure about their retirement: 33%
One big hurdle to overcome in the transition to retirement is making sense of Medicare and the retirement rules surrounding insurance and health savings accounts. Making mistakes early on could be costly throughout retirement.
4. Better health
Respondents who said this would make them feel more secure about their retirement: 40%
Reaching retirement age with good health opens a lot of doors: the option to continue working, to travel, perhaps even to retire abroad. The IRI survey found 80% of pre-retirees worry about the cost of health care and long-term care in retirement.
3. Long-term care insurance
Respondents who said this would make them feel more secure about their retirement: 46%
The top fear about retirement is managing long-term care costs, which was cited by 75% of respondents in the survey.
However, you shouldn’t automatically assume long-term care insurance is the way to go. Money Talks News founder Stacy Johnson explores how and if you should make the purchase in “Should I Buy Long-Term Care Insurance?”
1. More guaranteed income (tie)
Respondents who said this would make them feel more secure about their retirement: 56%
Unsurprisingly, a majority would breathe easier knowing they had more money coming in every month during retirement. Only 40% of near-retirees think Social Security and a pension will provide enough income.
Other options include annuities and reverse mortgages. Explore these options and more in “6 Ways to Guarantee Yourself a Steady Retirement Income.”
1. More savings (tie)
Respondents who said this would make them feel more secure about their retirement: 56%
More than half of survey respondents said if they got a sudden 25% increase in income, they would beef up their savings. Conversely, 48% of respondents who had a sudden 25% drop in income would take more from savings, a larger number than would consider downsizing, returning to work or asking for help.
How to increase your retirement peace of mind
Retirees and pre-retirees agree: Top sources for peace of mind are having a bigger pile of savings and a steady income.
“An inference from these findings may be that while insurance more efficiently mitigates such risks, money in the bank and regular income feel more tangible and have a greater impact on Americans’ overall feeling of being financially secure in retirement,” the survey report states.
The biggest struggle in planning for retirement may be dealing with unknowable variables — what will happen to you in the future and how much money will you need for both the good and the bad?
Finding peace of mind in retirement is part hard work, part diligent planning and part managing expectations. That’s why Money Talks News offers The Only Retirement Guide You'll Ever Need, an online course that addresses the nuts and bolts of saving more money, putting it in the right places, and dealing with your retirement fears wisely.
Many of us simply avoid thinking about the problem until it becomes urgent. But setting yourself up for success in retirement requires time, and starting early is a huge gift to your future self.
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