Americans estimate $1.2m needed for comfortable retirement: Schroders Survey
Retirement planning is a crucial aspect of financial stability, yet many Americans are falling short of their savings goals. According to the Schroders 2024 US Retirement Survey, the average American enrolled in a workplace retirement plan believes they will need $1.2 million saved to live comfortably in retirement. However, the reality is quite different, with 46% of participants estimating they will have less than $500,000 saved and 23% expecting to have less than $250,000.
The survey also revealed that the average age at which participants anticipate retiring is 63, with only 29% confident they will reach the $1 million mark before they retire. This disparity between retirement savings goals and actual savings highlights the need for better financial planning and education.
One concerning finding from the survey is that 28% of plan participants lack knowledge about retirement asset allocation, leading to emotional investment decisions across all investments. Additionally, 66% fear losing money in stock market downturns, and 24% are uncertain about investing their cash holdings.
Despite these challenges, 70% of respondents consider their workplace plan as their primary retirement asset. However, 59% desire more employer guidance on investment, and 42% are not working with a financial adviser. This lack of professional guidance could be contributing to the financial anxiety experienced by many participants, with 60% worrying excessively about money and 39% losing sleep over financial concerns.
Looking ahead, 88% of US retirement savings participants are concerned about the 2024 election, with varying levels of planning for potential changes in their investment portfolios. This uncertainty underscores the importance of having a solid financial plan in place to weather any economic or political fluctuations.
In response to the growing need for consumer protection in the financial industry, companies like Schroders are partnering with fintech solutions providers like Broadridge to ensure compliance with regulatory requirements. By leveraging technology and data analytics, fund producers can better understand and meet the needs of their customers under the UK Financial Conduct Authority’s Consumer Duty laws.
Overall, the Schroders 2024 US Retirement Survey highlights the importance of proactive financial planning and education to ensure a comfortable retirement. By seeking professional guidance, diversifying investments, and staying informed about market trends, Americans can work towards achieving their retirement savings goals and securing their financial future.
Disclaimer: The information provided in this article is for informational purposes only and should not be considered as financial advice. The content is based on general research and may not be accurate, reliable, or up-to-date. Before making any financial decisions, it is recommended to consult with a professional financial advisor or conduct thorough research to verify the accuracy of the information presented. The author and publisher disclaim any liability for any financial losses or damages incurred as a result of relying on the information provided in this article. Readers are encouraged to independently verify the facts and information before making any financial decisions.