Retirement insecurity: Pre-retirees less confident they can cover basic living expenses

A new survey from LIMRA underscores what many other studies have found: Americans are not feeling confident about their retirement savings. In a release entitled “It’s No Longer Your Parents’ Retirement,” LIMRA researchers said that workers today are concerned that their households will not receive enough lifetime-guaranteed income to cover basic living expenses in retirement.

The study noted the long-term movement away from pensions and toward other types of retirement plans: 61% of pre-retirees said they expect a defined contribution (DC) plan to be a top retirement income source, with only 27% saying a traditional defined benefit (DB) pension plan is likely to be a top retirement income source. In comparison, only 8% of currently retired respondents in the survey said DC plans are a top income source, while 38% said a DB pension was a top income source.

The report also said that less than one quarter of workers under 50 will have access to a pension plan when they retire. “The ongoing decline in pensions could partly explain why workers feel they will not have enough income, but other factors like uncertainty about Social Security benefits, market volatility, and the rising cost of living, are undoubtedly playing a role,” said Matt Drinkwater, corporate vice president of annuity and retirement income research at LIMRA.