An increasing percentage of workers say their workplace retirement savings plan will be a major source of retirement income, according to an annual survey by the Employee Benefit Research Institute issued Tuesday.
Fifty-three percent of workers in 2018 said these plans will be the major source of retirement, up from 47% in 2017, said a report about the survey results. Between 2009 and 2017, the percentage hovered between 42% and 47%.
By contrast, workers are much less confident about the role Social Security will play in their retirement than are current retirees, said Craig Copeland, EBRI senior research associate and co-author of the report, during a telephone news conference Tuesday. The survey found that only 36% of workers said they expected Social Security to be a major source of income, while 67% of retirees said Social Security is the major source of income, Mr. Copeland said.
The survey report also found that workers participating in a defined contribution plan were more confident about retirement than workers lacking a retirement plan. Seventy-six percent said they were at least somewhat confident in their ability to live comfortably in retirement vs. 46% of those without a DC plan.
Although many workers appear satisfied with their DC plans, a large percentage "don't know what to do with their plan assets in retirement," Mr. Copland added. For example, 31% said they don't know whether they would put the money into a rollover IRA, keep the money in the plan or cash out.
Health-care costs and planning played a significant role in how workers and retirees assess their ability to retire comfortably, said Lisa Greenwald executive vice president of Greenwald & Associates, said during the teleconference. Ms. Greenwald's market research firm collaborated with EBRI on the survey, which was conducted online in January with 1,002 workers and 1,040 retirees.
Ms. Greenwald noted that the survey showed only 19% of workers and 39% of retirees tried to calculate how much money they would need to cover health-care costs in retirement.
In addition, Ms. Greenwald pointed out that 44% of retirees said their health-care costs were much higher than expected or somewhat higher than expected than when they first retired. Calculating health-care costs "seems to be a blind spot" in retirement planning, she said.