Retirees and Pre-Retirees sitting on a bench

Inflation, Long-Term Care Differs for Retirees and Pre-Retirees

Another study by Greenwald & Associates was done by online survey of 2,000 retirees and pre-retirees for the Society of Actuaries to assess financial concerns.

Workers age 45 and older (69%) indicated they are worried about inflation and long-term care, followed by paying for health care (67%). 58% of retirees, on the other hand, are concerned about long-term care with 52% concerned about inflation and 47% about health care.

Almost 70% of pre-retirees expect to work in retirement to cover these costs and 46% plan to delay their retirement. The number of retirees who actually worked during their retirement is only 30% and a mere 12% tried to postpone their retirement.

Life expectancy is 10 years less than the longest-living relative for both pre-retirees (37%) and retirees (28%), with pre-retirees expecting to live to 85. In spite of this, only 33% of pre-retirees and 22% of retirees have, or plan to purchase a guaranteed lifetime income product.

The major forms of debt for retirees are mortgages, credit cards and car loans (52%, 48%, 40% respectively) and excluding mortgages, the average debt is $30,000. 52% of retirees carry less than a $10,000 debt.

38% of pre-retirees have no planning horizon, 17% are only looking out to five to nine years and 19% are considering 10 to 14 years.

23% of retirees reported that their number one financial shock was in home repair; 24% found it in major dental work and 20% said that shock was in medical/prescription expenses.

Actuary Cindy Levering says, “There is still a disconnect between what people think they will do in retirement to manage risks, compared to what approaches retirees actually used.”

Let your QBI Consultant know how we can be of help with timely and effective administrative plan reviews.

Financial Wellness Factors

The “Financial Finesse Year in Review: 2015” concluded that employees who have live interactions...

Read more

How Do Defined Benefit and Cash Balance Plans Become Overfunded?

Even though underfunded defined benefit plans have received more attention after years of bear...

Read more

Infographic: 9 Types of Retirement Plans

There are several types of retirement plans that employers may provide at the work place for...

Read more