Advisors Enhance Assurance

The 26th annual Retirement Confidence Survey from the Employee Benefit Research Institute (EBRI) concluded that there was a small increase in the “very confident” rating of employees’ ability to retire comfortably between 2014 and 2015. Record lows existed between 2009 and 2013 due to the financial instability during that time period. .

21% of workers now are very confident that they will be financially comfortable throughout retirement; this is up from 13% in 2013, but down 1% from 2015. 42% are somewhat confident, which is up from 36% in 2015 and 38% in 2013. This increase in confidence occurred mainly in employees who participated in a plan: those very confident were only 14% in 2013, and up to 26% in 2016.

Employees who described themselves as very confident, but did not participate in a plan remained statistically unchanged from 10% in 2013 to 10% in 2016. This group is more than three times as likely to describe themselves as not at all confident about their retirement security (38% vs. only 11% with a plan).

Luke Vandermillen, Vice President at Principal Financial Group expressed that the top factor driving confidence is whether or not the person has access to a retirement plan through their employer or through an individual retirement account (IRA). Then, people who spoke to an advisor are more confident than those who didn’t. He also expressed, “It’s no surprise that people’s confidence took a dip in 2008-09, and we’ve been crawling back since…We’ve seen increases year over year since then, and 2016 is better than 2015.”

Bottom line: EBRI reported that 53% of retirees who spoke with an advisor are very confident about retirement.

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