Retirement insights from a Colorado PERA perspective

Issues & Perspectives

National Attitudes on Retirement Security, Part 1

This article is a part of National Attitudes on Retirement Security series
  • Part 1 – Currently Reading

    National Attitudes on Retirement Security, Part 1

  • Part 2

    National Attitudes on Retirement Security, Part 2

Workers answering questions about retirement security
Photo credit: stockbyte-89986660-thinkstock

In this story:

  • A new study looked at the attitudes people across the country have about retirement
  • Americans are generally concerned about their ability to have a secure retirement
  • Reasons for concern included rising costs, longer lifespans, and market volatility

Retirement studies often focus on statistics that capture trends about groups of people. “How much does the average retirement-age person have saved for retirement?” “What’s the average retirement age these days?” “What percentage of people are on track to retire by 65?”

Studies like these are helpful when trying to understand the various circumstances from which people approach retirement, but we don’t learn much about the people themselves.

A new study prepared by The National Institute on Retirement Security stands out because it does just that. People across the country shared their thoughts about retirement security. What do they worry about? How do they feel about the future? What do they trust?

Retirement Security Concerns

The responses highlighted a number of concerns Americans have about retirement security. Some of them include:

Many Americans feel retirement security is out of reach
  • 67% of respondents said the U.S. faces a retirement crisis
  • 56% are concerned they won’t become financially secure, and 58% said it’s getting harder as time goes on
  • 68% said they aren’t able to save enough to guarantee a secure retirement

When asked to cite reasons for their concerns, respondents gave a mix of reasons. The cost of health care and long-term care topped the list. About half of the respondents cited longer lifespans, lack of access to a pension, stagnant salaries, debt, and the complexities of managing retirement savings themselves. One-third mentioned stock market volatility .

Yes, COVID-19 has had an impact.
  • Half of respondents said the pandemic has increased their concerns about retirement security
  • One-third of respondents said they are rethinking their retirement plan, and two out of three said they are pushing their planned retirement date farther into the future.

A variety of reasons stand behind the pandemic’s financial impact. About a quarter of respondents said they’ve needed to use emergency savings. One in four said their employer reduced contributions to their retirement plan.

The Critical Component: Retirement Security

Retirement planning contains few one-size-fits-all explanations. For instance, there’s not a set dollar amount everyone shoots for. People approach the many non-financial decisions related to retirement — about healthcare, housing, and lifestyle — on a case-by-case basis, too.

There’s also the fact that this was a broad study, not limited to those with a particular type of retirement plan or to a particular part of the country. Why does that matter? Not everyone has access to the same set of retirement tools. For example, PERA members have access to both a pension and self-directed savings through a 401(k). However, the majority of workers today don’t have access to a pension and about one in three don’t have access to any kind of retirement savings account through their job. The retirement tools that any one person does or does not have likely influences their views.

But after considering the responses people shared in the responses above, a definition of retirement security that does apply to most people begins to emerge: Retirement security is feeling confident about planning for the future despite life’s unavoidable uncertainties.

Even in their working years, people employ methods to gain security: purchasing insurance and building up an emergency fund are two examples. Of course, taking these measures does not mean that bad breaks will not occur. But they can make tough times more financially manageable if and when they do.

So what tools would make the prospect of retirement more secure? The next issue of PERA On The Issues will explore how respondents answered that question and what PERA members should know about their own retirement.

VolatilityVolatility of returns is the measurement used to define risk. It describes the variation of price of a financial instrument over time. The greater the volatility, the higher the risk.

Featured in this story
  • PERA On The Issues
This article is a part of National Attitudes on Retirement Security series
  • Part 1 – Currently Reading

    National Attitudes on Retirement Security, Part 1

  • Part 2

    National Attitudes on Retirement Security, Part 2

Comments

  1. David S Prok says:

    HUGE CONCERN: The Biden policy is ruining our economy, safety of citizens and affordability of health costs. With his decisions to eliminate jobs, there is more insecurity and many struggle with income to meet basic needs. His border policies are increasing crime, Covid19 spread and uncertainty. Those nearing retirement are concerned about heath costs and rising medical bills and treatments. TRANSLATION: Costs are escalating for everyone! I urge PERA, and any other organization, to be pro-active with Congress to help seniors afford retirement and manage their pensions.

    • Robert H Richau says:

      I think that President Biden inherited a mess, Medical costs is one of those. As we turn the corner on Covid we can begin re employment and try to assure workers a good wage and retirement savings increases.

      • Clare Card says:

        TRUMP 2018
        Average household income: $61,400
        Overall unemployment rate: 3.9%
        Unemployment rate women: 3.8%
        Unemployment rate hispanics: 4.4%
        Unemployment rate blacks: 6.6%
        Total Jobs GAINED: 2.3 Million

        OBAMA 2009
        Average household income: $50,221
        Overall unemployment rate: 9.9%
        Unemployment rate women: 8.7%
        Unemployment rate hispanics: 12.8%
        Unemployment rate blacks 16.1%
        Total Jobs LOST: 5.1 Million

        • Paul says:

          Ms Card, I’m not sure what your point is in providing statistics you are attributing to Trump in “2018” and Obama in “2009” for some sort of comparison?
          Trump left office in January of 2021, not 2018, and Obama left office in January of 2016, not 2009. Mr. Richau’s comment was about Biden inheriting a mess (from Trump in 2021).
          If you want to compare the 2, the other relevant facts are that Trump inherited a growing economy built by the Obama/Biden administration over the course of 8 years and it continued on an upward trajectory during the Trump administration until it went in the toilet in 2019 during the last year of Trump’s administration. To Mr. Richau’s point that you commented on, by January of 2021, Trump clearly left Biden a mess.
          Specifically, Trump left an economic mess and a public health mess that was a made worse because of his mismanagement of the federal government and the pandemic.
          If you were attempting to show what Trump left Biden v. what Obama/Biden left Trump, the relevant dates would be January 2017 v. January 2021.
          So for example,
          The unemployment rate when Trump left in January of 2021 was 6.3%.
          The unemployment rate when Obama left in January of 2017 was 4.8%.

    • John Coco says:

      I didn’t realize that within a month of his employment as our POTUS he had already done so much damage. Isn’t the responsibility of government on all leadership no matter their political background and at both the state and central government?

    • Gordon Kaufman says:

      The initial comment, to me, is intended to scare me back into the “Dark Four Year” that we just came out of. President Biden has been in office six weeks, and how anyone can make those statements at this point in is jumping the gun. I have NOT seen any “Biden era” statistics on increasing crime from/at the border. Covid spread certainly did NOT begin with Biden. Covid has certainly change retirement for many people due to unexpected, severe health situations (aside from 1/2 million deaths).
      As for the statistics in the follow-up comment, some of them do not jive with what I’ve read over the last decade. Regarding Obama’s 2009 year, one needs to recall what he inherited from the 2008 year.

    • Pamela Mickle says:

      You need more sources of information. Biden’s policies will increase jobs. His border policy is humane and controls illegal immigration while adhering to asylum laws. His Covid policies are making vaccines more available. Healthcare premiums and costs increased under Trump. The stock market is holding so far under Biden. Investors know that Biden’s economic policies are sound.

      • Lee Davis says:

        Excellent synopsis. Couldn’t have said it better. At 71 and retired I am still amazed at what 45 organized and incited on Jan 6 on our hallowed halls. And that people still support 45 is almost as amazing- his very tweets and words have convicted him.

    • Wendall Johnson says:

      I agree.

  2. Clare Card says:

    TRUMP 2018
    Average household income: $61,400
    Overall unemployment rate: 3.9%
    Unemployment rate women: 3.8%
    Unemployment rate hispanics: 4.4%
    Unemployment rate blacks: 6.6%
    Total Jobs GAINED: 2.3 Million

    OBAMA 2009
    Average household income: $50,221
    Overall unemployment rate: 9.9%
    Unemployment rate women: 8.7%
    Unemployment rate hispanics: 12.8%
    Unemployment rate blacks 16.1%
    Total Jobs LOST: 5.1 Million

    • John Coco says:

      The Obama stats are after the 2008 mess-what were the stats in 2015?? I will post them if you need them.
      Please identify where these facts came from-we need to judge apples to apples.

    • Grateful Living says:

      It’s unfortunate that many Americans continue to unquestioningly accept what they read on social media rather than to go to more reputable, intellectually adult sources for information and analysis. The above post seems to me an example of that.
      For an objective analysis of what the above poster would have readers believe, go to the Reuters article below which uses U.S. Bureau of Labor Statistics (BLS) data to carefully examine the specific assertions that the above poster claims (without providing the TikTok source of them).
      As stated in the Reuters article, “…figures from the U.S. Bureau of Labor Statistics show that while most of the figures in the [TikTok] video (the same as those cited by the above poster) were true for some months, they are not necessarily representative of unemployment levels during the two administrations and do not take into the effects of the 2007-2009 Great Recession and the coronavirus pandemic.” In other words, cherry-picking kaka – what one should expect from supporters of the recently fairly defeated president who is documented to have made more than 30,000 false or misleading claims while in office.

      https://www.reuters.com/article/uk-factcheck-obama-trump-numbers-tiktok/fact-check-video-comparing-trump-and-obama-unemployment-rates-and-job-growth-is-misleading-idUSKBN28D34P

    • Terri Healy says:

      Even if those figures are accurate, and I’m not sure they are, it makes no sense to compare Obama’s first year in office (during a recession he inherited) to Trump’s second year in office (which was after several consecutive years economic and job growth.) It’s simply not a fair comparison.

    • Doug Driver says:

      Compare Trump 2020 to Obama 2015 and you would have a completely different story.

    • Paul says:

      Ms Card, I’m not sure what your point is in providing statistics you are attributing to Trump in “2018” and Obama in “2009” for some sort of comparison?
      Trump left office in January of 2021, not 2018, and Obama left office in January of 2017, not 2009. Mr. Richau’s comment was about Biden inheriting a mess (from Trump in 2021).
      If you want to compare the 2, the other relevant facts are that Trump inherited a growing economy built by the Obama/Biden administration over the course of 8 years and it continued on an upward trajectory during the Trump administration until it went in the toilet in 2019 during the last year of Trump’s administration. To Mr. Richau’s point that you commented on, by January of 2021, Trump clearly left Biden a mess.
      Specifically, Trump left an economic mess and a public health mess that was a made worse because of his mismanagement of the federal government and the pandemic.
      If you were attempting to show what Trump left Biden v. what Obama/Biden left Trump, the relevant dates would be January 2017 v. January 2021.
      So for example,
      The unemployment rate when Trump left in January of 2021 was 6.3%.
      The unemployment rate when Obama left in January of 2017 was 4.8%.

    • Gary says:

      The comparison you are using for Obama is at the beginning of his presidency, the economic conditions were the result of Republican Bush driving the country into the ground. Get educated first!!

    • Wendall Johnson says:

      These stats tell it all.

    • Gerald Michels says:

      Thanks for this info. FACTS.

  3. Charley S says:

    The socialist Biden Administration is the reason we as future retirees are all worried – scared about our future health care access as we get older and careless spending leading to terrible tax increases just as we reach retirement age.

    • Paul says:

      Charlie, You really need to take some political science classes if you think Biden is a socialist.

    • Doug Driver says:

      Hmmm… Pensions are fairly “socialistic” in nature. Maybe you should give yours up since you seem to detest socialism.

    • Wendall Johnson says:

      The Biden(socialists) administration is pushing for medicare for all and eliminating private health insurances plans.

  4. Gordon Kaufman says:

    Regarding the first comment, someone is certainly jumping the gun on the comments as our new President has been in office for about six weeks. Decisions to eliminate jobs is too broad of a statement for my perspective. Too many jobs were/have been lost due to Covid impacts. I haven’t seen any recent statistics on border crime for the last six weeks. Covid has certainly impacted retirement decisions for many, many Americans.
    As for the “data” comment, one needs to remember what former President Obama was dealing with when he took office. 2008 was certainly not a banner year for our economy and financial sector.
    To finish on a more positive note, I am so thankful for the PERA leadership that has provided stability to our system that we now enjoy. I’m trusting that our current leadership will continue to represent our membership when interacting with our legislature and governor.

    • Brad Stauffer says:

      This forum should not be a place for political disinformation. Keep the politics off of here. Focus on retirement planning strategies.

      • Paul says:

        Agreed, however if PERA is going to allow the Trumpkins to post the misinformation, we kinda have to respond or this becomes one more place where the uninformed are informing the uninformed.

    • Marie Peterson says:

      THANK YOU so much for adding a little reality to the discussion. Your observations were very much needed to combat the “socialism-fear” that is so common now.

    • Dean Stegman says:

      Thanks for looking at that with clear lens!

  5. Mary Morris says:

    Seriously, must the source we expect to explore the status of our PERA retirement and a place we can express our concerns and desires regarding what happens to this retirement somehow become a political battlefield where parties need to be defensive by citing varied circumstances during complicated times? Hopefully, we will progressively face our future instead of engaging in pouting matches. Stand back, take a deep breath and be examples of what we want to be during this time. Our actions and attitudes mentor to those who follow.

  6. Jim K says:

    Claire
    The statistics you presented, Obama 2009 to Trump 2017, to compare the Obama Administration to the Trump Administration are truly misleading. Obama 2009 was at the very beginning of his first year as president working to recover from the worst economy in decades then turned the economy into the best recovery in decades at the end of his presidency in 2017 and turned over a robust economy to Trump in 2017. Better to use Obama 2016 to Trump 2020.

  7. Beverly says:

    I expect PERA to be more responsible about printing comments that have misinformation. Appreciating sensitivity to free speech, it does none of us a service to not fact check and at the very least state that a misleading statement has not been fact checked. Haven’t we learned anything from 2020?

  8. J Schlaefer says:

    Back to the theme of the article, savings is a problem – the 401K and Roth strategies have not provided a stable retirement plan as they are volatile, by nature of the market. The fluctuations we have been taught to “ride out” have been overridden by huge market swings that decimate the value of a retirement portfolio. I have had to rebuild my IRA after repeated losses of 35% to almost 50% from 9/11, 2008, etc. For the average person, these losses are difficult to recoup. The volatility of our pension schemes (will they be here in 5 years?) coupled with governmental threats to SS and Medicare benefits leave many of us deeply concerned for what can we rely on as a base-level of retirement. Lastly, the global distain for savings, in any form, is killing retirement planning. Investment vehicles that once reflected inflation/interest rates has been manipulated and bank interest rates flattened to near nothing. Talk abounds about the potential for negative interest rates to spur on a weak service industry dependent economy. These devices could (unlikely but possible) mean banks charging for us to reside our money in their bank for their use…I didn’t retire a millionaire. I watch our spending carefully against the backdrop of increasing meddling with my medical insurance, which now eats most of my PERA retirement check. The reality is, this fight is uphill and has been for a very long time- pick an administration, any administration, they all have their fingerprints on our struggle. I at least have something to plan thanks to PERA and SS. I fear for those among us who have no such luxury as a pension to manage.

  9. Dan Hickenbottom says:

    The WEP hurts PERA retirees who have paid SS to the federal government and will not receive their full SS benefits when they retire.

    I worked in the private sector and paid SS for 25 years and was counting on the full benefit to retire. I will be looking for a part-time job when I retire.

    Our representatives at the Capitol will not even cancel their 3% yearly raises during the budget crisis and I am not aware of any deductions our politicians in DC take against their retirement. You would think politicians would be ashamed of themselves sometimes.

    • Sandy Harrell says:

      Have you checked with Social Security to see if you had” significant income” in those years? My husband also worked in the private sector for 30 years and then taught at a junior college for several years. His social security was not reduced. I, on the other hand, only taught for 20 years so my PERA is reduced by 50%.

  10. Mike Morris says:

    Wow! I did not believe we had so many “right-wing nut-jobs” as PERA members as evidenced by some of the selective and exaggerated comments regarding our personal retirement security. Are you still trying to rehash the 2020 election? What you should be focused on is what we collectively do as PERA members to keep electing state legislators who understand how important PERA is to the COLORADO economy and it’s retirees. Vote in future local elections for candidates who value the contributions of our State employees.

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