A large number of working-age Americans believe it will be necessary to work longer than they had previously planned, but data suggests health problems and workplace realities may push them into an early retirement anyway.
A survey by PNC Financial Services Group recently found that 49 percent of Americans between the ages of 35 and 70 think they will have to work further into their lives that they previously thought to save enough money to retire.
But the same survey found that more than half of those who already have retired did so earlier than they had planned.
Celandra Deane-Bess, vice president and senior wealth planner with PNC, said, “What that means is this option of perpetually delaying your retirement age if you haven’t saved enough is not a good backup plan for saving for retirement.”
Of those who retired earlier than they had planned, PNC found 40 percent were pushed into an early retirement because of illness and an additional 28 percent because of actions by their employer.
Only 7 percent said they worked longer for the sole purpose of socking away more money.
Ms. Deane-Bess said the survey shows that it is not always easy to pick a retirement age and stick with it.
One reason? Many people are either procrastinating or completely sticking their head in the sand when it comes to making decisions about retirement planning.
Fifty-eight percent of people surveyed said they were either putting off making plans or had thought little about retirement. In general, those who admit they are not great planners more frequently say they will have to work longer.
On average, people who were surveyed expected to retire or stop working at 67. About 21 percent said they expect to work past 70 or have no plans to ever retire.
A little less than half of those who have not yet retired said they feel good about how well they have prepared. Nearly a quarter said they were not prepared at all. But even for those who feel they are not going to be able to save enough to meet their goals, planning is important, Ms. Deane-Bess said.
“It’s critical for people to take this very seriously and at least move out of the category of being an avoider who doesn’t want to look at it,” she said. “It’s important to look, know what you have, and have a plan even if what you have is insufficient.”
The survey included 1,200 men and women across the United States. One-third reported having assets greater than $100,000, though PNC didn’t break down preparedness by asset size.
Ideally, everyone would start saving as soon as they get their first paycheck. However, Ms. Deane-Bess said most workers should double down on their planning as they approach 10 years before their expected retirement date.
Contact Tyrel Linkhorn at email@example.com or 419-724-6134.