When it comes to saving for retirement, Coloradans are anxious, and so are most Americans. The National Institute on Retirement Security recently released results from a study of 400 Colorado adults age 25 or older to better understand their attitudes and opinions about retirement savings.
Along with a similar survey of adults across the country, the studies show that saving for retirement continues to be a daunting challenge for workers and that they would support policies to strengthen savings in retirement plans.
Retirement in crisis
Most Coloradans (82 percent) believe that the nation faces a retirement crisis, with both older (age 55 and over) and younger (ages 25-54) residents expressing similar levels of concern.
Younger Coloradans are more anxious about retirement than older residents of the state, and they are more willing to increase their savings as a way to ensure greater retirement security. When asked about their own retirement, 31 percent of older Coloradans and a near majority – 44 percent – of younger Coloradans reported feeling unprepared, unsettled, frightened or concerned about being prepared.[Read more from The Dime about how younger and older Coloradans’ views about retirement security differ, and where they are similar.]
Working to save…
Coloradans are working hard to prepare for retirement, with 80 percent planning to stay in their current job as long as possible before retiring. Seven of 10 plan to or are already cutting spending in retirement, and almost as many – 58 percent – say they plan to increase their savings a little in order to ensure a financially secure future.
…but falling behind
But at the same time, today’s economic conditions are concerning, say 72 percent of Coloradans. And 78 percent believe that it will get harder in the future for Americans to save for retirement.
Increasing costs along with debt and slow salary growth are particularly worrisome. The rising cost of long term care was the most troubling challenge, with 80 percent of Coloradans calling it a major factor in making retirement difficult, along with 79 percent who said salaries not keeping up and increasing debt are major factors as well.
Coloradans place a high value on retirement benefits, with nearly seven in 10 (69 percent) regarding retirement benefits as an extremely or very important job feature, and nearly two-thirds (65 percent) saying they’d be willing to sacrifice pay for guaranteed retirement income.
More than three-fourths (76 percent) believe that the average worker cannot save enough on their own to guarantee a secure retirement, and two-thirds (66 percent) say employers do not contribute enough money for a secure retirement for their workers. Even more respondents (82 percent) agree that the average retiree does not know enough about managing investments to ensure their savings will last.
Searching for solutions
When it comes to leadership from Washington, most Coloradans (84 percent) agree that leaders do not understand how hard it is to prepare for retirement. And almost as many (82 percent) agree that ensuring more Americans can have a secure retirement should be a higher priority.
With nearly nine out of 10 Coloradans (87 percent) holding favorable views of traditional pension plans, pension-style savings plans may be a part of the solution to the retirement security problem. In fact, large majorities see pensions bringing security, with 83 percent agreeing that government should make it easier for employers to offer traditional pension plans, and 79 percent saying that pension disappearance is harming their ability to achieve the American Dream.
Pension benefits should be available to all workers, according to more than three quarters (78 percent) of Coloradans. But for workers who do not have access to a retirement plan through their employer, 69 percent agree that a new retirement plan facilitated by the state is a good idea.
Good for Colorado, good for the country
Nationally, 55 percent of those surveyed “strongly agreed” that the country faces a retirement crisis and 80 percent said the average worker “cannot save enough on their own to guarantee a secure retirement.” That’s up from 73 percent in 2015.
Pensions beat 401(k)s for living comfortably, according to 71 percent of Americans.