Recent retirees and those about to retire are relatively comfortable and confident in their retirement income, said a survey conducted by Brightwork Partners for T. Rowe Price Group.
The survey was conducted to mark the first retirements of the oldest baby boomers, who turned 65 in 2011, said Anne Coveney, senior manager of thought leadership at T. Rowe Price Group, who led the study for the firm.
These baby boomers also represent the first generation reaching retirement that relies significantly on defined contribution plans for their retirement income.
Among the most notable results is that recent retirees are living relatively comfortably on an average 66% of pre-retirement income, less than the 75% to 85% financial planning standard, Ms. Coveney said in a telephone interview.
“The real finding is they're the people making it work,” she said. “They're already adjusting and they're already flexible early in retirement.”
“I think it's positive because they're adjusting early in retirement,” she added.
The largest amount of income for the retirees comes from Social Security, which accounts for 43% of income, followed by defined benefit plans at 19%, individual retirement accounts at 11%, earnings from current employment or self-employment at 8% and DC plans at 7%. Seven other sources of income make up the remaining 12%.
Among the retiree population, 89% said they are very or somewhat satisfied with their retirement.
Among the workers nearing retirement, there is slightly more pessimism regarding their future retirement, along with less of a sense of job security. Twenty-nine percent of those respondents say they are somewhat or very concerned they will lose their jobs in the next 12 months.
“That seemed pretty high to me,” Ms. Coveney said, “so for the over-50 workers, job security is a question mark and then 43% this year have considered delaying their retirement.”
Brightwork surveyed 1,507 adults who have retired in the past one to five years who have a 401(k) plan account balance or rollover IRA, and 1,030 working adults age 50 and over, who are contributing to a 401(k) plan. Interviews were conducted from Feb. 19 to March 3.
T. Rowe Price has made the survey presentation available online.