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.”
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