An Insured Retirement Institute (IRI) research brief maintains millions of Generation X (Gen X) workers will approach retirement uneasy about Social Security and with worries about insufficient retirement savings.
“Gen Xers have a fundamental disconnect that is consistently observed in IRI and other consumer research focused on retirement income and expenses, namely, that the desire to maintain lifestyle leads to hopeful responses,” IRI Research Vice President Frank O’Connor said. “Some may believe they can work longer or part-time, expect to receive an inheritance or plan to sell a home for a significant profit. Whatever the case, retirement lifestyle expectations are out of step with retirement savings levels and confidence measures.”
Per the IRI research brief, the analysis was executed via internet interviews, with a total of 2,241 adult Americans aged 40-80 interviewed.
The final sample included the following 902 GenX respondents (ages 40-55), 918 Baby Boomer respondents (ages 56-73) and 801 retirees aged 40-80.
According to the report, the average retirement savings of workers in their peak earning years (Generation X) and near retirement (working Boomers) are insufficient to support income expectations, save for the relative few who anticipate receiving income from a public or private pension.
The analysis also determined it is also unlikely that pension income will be as common as the survey indicates, as defined contribution plans are often misunderstood to be equivalent to pensions.
According to the research brief, 16 percent of private sector workers have access to a defined benefit (pension) plan, with 27 percent of baby boomers and 23 percent of GenXers believing they will receive pension income.
Additionally, the analysis showed despite low confidence in their savings lasting throughout retirement, most workers and retirees believe they will have enough to be secure in retirement and have discretionary income for leisure activities.