GALLUP NEWS SERVICE
PRINCETON, NJ -- Gallup's annual poll on Americans' personal finances shows that only about six out of 10 Americans expect to have enough money to live comfortably when they retire. Additionally, retirement savings tops the list of Americans' financial worries. The public's expectations about how they will fund their retirement shows the changing landscape of financial planning. Older Americans, along with those who are currently retiring, are more likely to cite Social Security as a major source of their retirement income than are younger Americans. Younger Americans expect their 401(k), IRA, or other retirement savings accounts -- much more so than Social Security -- to be their main source of income after retirement. Also, Americans' expectations about when they will retire are somewhat different from the experience of current retirees, as the typical American expects to retire at age 63, but the average age of retirement found in the poll for actual retirees is 59.
Most Expect a Comfortable Retirement
The poll, conducted April 8-11, shows that only about six in 10 Americans are optimistic about their financial situation when they retire. Fifty-nine percent of non-retired Americans say they expect to live comfortably when they retire, while 32% do not.
By comparison, a significantly higher 75% of all Americans (74% of non-retirees) say they live comfortably now. Eighty-one percent of retirees say they currently have enough money to live comfortably.
| Have/Expect to Have Enough Money to Live Comfortably? |
 |
| April 8-11, 2002 |
Younger Americans are most optimistic about their financial situations upon retirement. Among those aged 18-29 years, 73% expect to have enough money to live comfortably when they retire. This is very similar to the percentage of those aged 18-29 years who say they have enough money to live comfortably now, 75%. Among the other age groups, people are much more likely to say they are living comfortably now than expect to live comfortably when they retire.
| Have/Expect to Have Enough Money to Live Comfortably, by Age |
 |
| Non-retired adults -- April 8-11, 2002 |
Americans rank retirement savings atop a list of financial concerns. Just over half, 54%, say that they are either very (25%) or moderately (29%) worried about not having enough money for retirement. Less than a majority of Americans say they worry about the other financial concerns measured.
|
Financial Concerns of Americans |
||||
|
|
|
|
|
Total |
|
% |
% |
% |
% |
|
|
Not having enough money for retirement |
25 |
29 |
54 |
41 |
|
Not being able to pay medical costs in the event of a serious illness or accident |
21 |
24 |
45 |
53 |
|
Not being able to pay medical costs for normal health care |
18 |
17 |
35 |
62 |
|
Not being able to maintain the standard of living you enjoy |
12 |
23 |
35 |
63 |
|
Not having enough to pay your normal monthly bills |
11 |
19 |
30 |
69 |
|
Not being able to pay your rent, mortgage, or other housing costs |
8 |
14 |
22 |
73 |
|
Not being able to make the minimum payments on your credit cards |
7 |
8 |
15 |
69 |
Retirement Savings Account Expected to Be Main Source of Income
Among non-retired Americans, most expect a 401(k), IRA, Keogh, or other retirement savings account to be a major source of income for their retirement. The second most frequently mentioned source of future income is a work-sponsored pension plan. Social Security comes in third on the list, as 27% expect it to be a major source of income (although another 56% expect it to be a minor source of income). At least one in five Americans expects to rely a great deal on their home equity, stock and mutual fund investments, or their own savings to help fund their retirement.
|
Expected Retirement Income Sources |
|||
|
Major source |
Minor source |
Not a source |
|
|
% |
% |
% |
|
|
A 401(k), IRA, Keogh, or other retirement savings account |
53 |
28 |
16 |
|
A work-sponsored pension plan |
29 |
33 |
36 |
|
Social Security |
27 |
56 |
15 |
|
The equity you have built up in your home |
24 |
40 |
33 |
|
Individual stock or stock mutual fund investments |
23 |
43 |
32 |
|
Other savings such as a regular savings account or CDs |
23 |
50 |
25 |
|
Part-time work |
16 |
51 |
31 |
|
Money from an inheritance |
10 |
28 |
60 |
|
Rent and royalties |
8 |
29 |
60 |
|
Annuities or insurance plans |
7 |
40 |
51 |
Expectations about retirement funding vary greatly by age. Among all three age groups, a retirement savings account is most commonly expected to be a major source of funds, especially among younger Americans. Roughly four in 10 Americans over age 50 expect to rely heavily on Social Security, but fewer than one in four those aged 30-49 years and fewer than one in five of those aged 18-29 years do so. In fact, younger Americans expect to rely much more on their savings accounts, individual stocks or mutual funds, and even part-time work than on Social Security. Older Americans are slightly more likely to believe they will rely on a pension plan and on their home equity than are younger Americans.
|
Expected Retirement Income Sources by Age^ |
|||||
|
(Percent saying major source of funds) |
|||||
|
18-29 years of age |
% |
30-49 years of age |
% |
50+ years of age |
% |
|
401(k)/ IRA |
59 |
401(k)/ IRA |
55 |
401(k)/ IRA |
42 |
|
Savings Account/ CDs |
35 |
Pension Plan |
29 |
Social Security |
39 |
|
Stocks/ Mutual Funds |
29 |
Social Security |
24 |
Pension Plan |
33 |
|
Pension Plan |
26 |
Home Equity |
24 |
Home Equity |
27 |
|
Part-time Work |
21 |
Stocks/ Mutual Funds |
22 |
Stocks/ Mutual Funds |
17 |
|
Home Equity |
19 |
Savings Account/ CDs |
18 |
Savings Account/ CDs |
17 |
|
Social Security |
18 |
Part-time Work |
12 |
Part-time work |
15 |
|
Inheritance |
15 |
Rent/ Royalties |
7 |
Rent/ Royalties |
10 |
|
Rent/ Royalties |
9 |
Inheritance |
7 |
Inheritance |
6 |
|
Annuities/ Insurance |
8 |
Annuities/ Insurance |
6 |
Annuities/ Insurance |
6 |
|
^ Non-retired Americans |
|||||
Most Retirees Rely Heavily on Social Security
The changing landscape of retirement funding is even more apparent when one looks at how current retirees are paying for their golden years. Social Security is by far the most commonly cited source of retirement funding among retirees. A majority, 58%, says this is a major source of their income. Pension plans rank second at 29%. Retirement savings accounts, the primary funding vehicle for younger Americans, rank only third as a source of income among current retirees. In fact, a majority of retirees say retirement savings accounts are not a source of retirement funding for them, as these have been only recently introduced as a retirement funding option.
|
Retirement Income Sources |
|||
|
Major source |
Minor source |
Not a source |
|
|
% |
% |
% |
|
|
Social Security |
58 |
22 |
18 |
|
A work-sponsored pension plan |
29 |
16 |
51 |
|
A 401(k), IRA, Keogh, or other retirement savings account |
19 |
23 |
56 |
|
The equity you have built up in your home |
18 |
14 |
60 |
|
Individual stock or stock mutual fund investments |
15 |
31 |
52 |
|
Other savings such as a regular savings account or CDs |
15 |
33 |
51 |
|
Annuities or insurance plans |
8 |
21 |
69 |
|
Rent and royalties |
6 |
13 |
80 |
|
Money from an inheritance |
4 |
11 |
84 |
|
Part-time work |
3 |
14 |
82 |
Apart from Social Security, pensions, and annuities, retirees are less likely than non-retirees to say that each item is a major source of their actual or projected retirement income. For example, 16% of non-retirees expect to rely on part-time work as a major source of funding, but only 3% of retirees currently do. Twenty-three percent of non-retirees expect to rely to a great extent on their personal savings, but only 15% of retirees say they do so. The largest differences between retirees' current experience and non-retirees' expectations are seen with regard to Social Security, retirement savings accounts, and part-time work.
|
Retirement Income Sources: Retirees vs. Non-Retirees |
|||
|
(Percent saying "major source") |
|||
|
Retirees |
Non-retirees |
Difference |
|
|
% |
% |
% |
|
|
Social Security |
58 |
27 |
31 |
|
A work-sponsored pension plan |
29 |
29 |
0 |
|
A 401(k), IRA, Keogh, or other retirement savings account |
19 |
53 |
-34 |
|
The equity you have built up in your home |
18 |
24 |
-6 |
|
Individual stock or stock mutual fund investments |
15 |
23 |
-8 |
|
Other savings such as a regular savings account or CDs |
15 |
23 |
-8 |
|
Annuities or insurance plans |
8 |
7 |
1 |
|
Rent and royalties |
6 |
8 |
-2 |
|
Money from an inheritance |
4 |
10 |
-6 |
|
Part-time work |
3 |
16 |
-13 |
Non-Retired Americans Expect to Retire at a Later Age Than Current Retirees
The poll also asked non-retired Americans at what age they expect to retire. About half expect to retire before the age of 65, and half expect to retire at age 65 or older. The average estimated age is 63 years old. In 1995, when Gallup last asked this question, the average expected age of retirement was 60.
| At What Age Do You Expect to Retire? |
 |
| Non-retired adults -- April 8-11, 2002 |
The current results differ from the experience of retired Americans, who generally retired at a younger age than people expect to retire today. The average age of retirement found in the poll is 59 years old, four years less than the expected age non-retirees believe they will stop working. Only about one in four retirees say they retired at age 65 or older, and 38% retired before age 60. (Only 22% of non-retired Americans say they expect to retire before age 60.)
| At What Age Did You Retire? |
 |
| Retired adults -- April 8-11, 2002 |
Survey Methods
These results are based on telephone interviews with a randomly selected national sample of 1,003 adults, 18 years of age and older, conducted April 8-11, 2002. For results based on this sample, one can say with 95 percent confidence that the maximum error attributable to sampling and other random effects is + 3 percentage points. In addition to sampling error, question wording and practical difficulties in conducting surveys can introduce error or bias into the findings of public opinion polls.
Next, please tell me how concerned you are right now about each of the following financial matters, based on your current financial situation -- are you very worried, moderately worried, not too worried, or not worried at all. If a particular item does not apply to you, please say so. First, how worried are you about… How about… [RANDOM ORDER]?
A. Not being able to pay medical costs for normal health care
|
|
|
|
Not worried |
Doesn't apply |
|
|
|
% |
% |
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
18 |
17 |
26 |
36 |
2 |
1 |
|
2001 Apr 6-8 |
22 |
22 |
24 |
31 |
1 |
0 |
|
(vol.) -- Volunteered response |
||||||
B. Not being able to pay medical costs in the event of a serious illness or accident
|
|
|
|
Not worried |
Doesn't apply |
|
|
|
% |
% |
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
21 |
24 |
25 |
28 |
1 |
1 |
|
2001 Apr 6-8 |
27 |
23 |
24 |
25 |
1 |
* |
|
(vol.) -- Volunteered response |
||||||
C. Not being able to pay your rent, mortgage, or other housing costs
|
|
|
|
Not worried |
Doesn't apply |
|
|
|
% |
% |
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
8 |
14 |
26 |
47 |
4 |
1 |
|
2001 Apr 6-8 |
10 |
14 |
28 |
44 |
4 |
* |
|
(vol.) -- Volunteered response |
||||||
D. Not being able to maintain the standard of living you enjoy
|
|
|
|
Not worried |
Doesn't apply |
|
|
|
% |
% |
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
12 |
23 |
31 |
32 |
1 |
1 |
|
2001 Apr 6-8 |
16 |
27 |
30 |
26 |
1 |
* |
|
(vol.) -- Volunteered response |
||||||
E. Not being able to make the minimum payments on your credit cards
|
|
|
|
Not worried |
Doesn't apply |
|
|
|
% |
% |
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
7 |
8 |
21 |
48 |
15 |
1 |
|
2001 Apr 6-8 |
9 |
9 |
22 |
41 |
19 |
* |
|
(vol.) -- Volunteered response |
||||||
F. Not having enough money for retirement
|
|
|
|
Not worried |
Doesn't apply |
|
|
|
% |
% |
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
25 |
29 |
19 |
22 |
4 |
1 |
|
2001 Apr 6-8 |
24 |
29 |
24 |
19 |
4 |
* |
|
(vol.) -- Volunteered response |
||||||
G. Not having enough to pay your normal monthly bills
|
|
|
|
Not worried |
Doesn't apply |
|
|
|
% |
% |
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
11 |
19 |
27 |
42 |
1 |
* |
|
2001 Apr 6-8 |
12 |
20 |
29 |
39 |
* |
* |
|
(vol.) -- Volunteered response |
||||||
Right now, do you have enough money to live comfortably, or not?
|
Yes |
No |
No opinion |
|
|
2002 Apr 8-11 |
75% |
24% |
1% |
When you retire, do you think you will have enough money to live comfortably, or not?
BASED ON --823-- NON-RETIRED ADULTS
|
Yes |
No |
No opinion |
|
|
2002 Apr 8-11 |
59% |
32% |
9% |
When you retire, how much do you expect to rely on each of the following sources of money -- will it be a major source of income, a minor source of income, or not a source at all? How about -- [READ A-I IN ORDER]?
BASED ON --823-- NON-RETIRED ADULTS
A. Social Security
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
27 |
56 |
15 |
2 |
|
2001 Apr 6-8 |
28 |
57 |
14 |
1 |
B. A 401(k), IRA, Keogh, or other retirement savings account
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
53 |
28 |
16 |
3 |
|
2001 Apr 6-8 |
58 |
26 |
15 |
1 |
C. Individual stock or stock mutual fund investments
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
23 |
43 |
32 |
2 |
|
2001 Apr 6-8 |
24 |
39 |
36 |
1 |
D. Money from an inheritance
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
10 |
28 |
60 |
2 |
|
2001 Apr 6-8 |
7 |
29 |
63 |
1 |
E. Other savings such as a regular savings account or CDs
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
23 |
50 |
25 |
2 |
|
2001 Apr 6-8 |
16 |
51 |
32 |
1 |
F. A work-sponsored pension plan
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
29 |
33 |
36 |
2 |
|
2001 Apr 6-8 |
34 |
28 |
37 |
1 |
G. Rent and royalties
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
8 |
29 |
60 |
3 |
|
2001 Apr 6-8 |
5 |
22 |
72 |
1 |
H. Annuities or insurance plans
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
7 |
40 |
51 |
2 |
|
2001 Apr 6-8 |
7 |
34 |
58 |
1 |
I. Part-time work
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
% |
% |
% |
% |
|
|
2002 Apr 8-11 |
16 |
51 |
31 |
2 |
|
2001 Apr 6-8 |
10 |
52 |
36 |
2 |
J. The equity you have built up in your home
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
2002 Apr 8-11 |
24% |
40% |
33% |
3% |
At what age do you expect to retire?
BASED ON --823-- NON-RETIRED ADULTS
|
Under 55 |
|
|
|
Over |
Never retire |
No opinion |
|
|
|
% |
% |
% |
% |
% |
% |
% |
||
|
2002 Apr 8-11 |
7 |
15 |
21 |
26 |
21 |
-- |
10 |
63 |
|
1995 Dec 15-18 |
15 |
12 |
23 |
29 |
15 |
5 |
4 |
60 |
|
1995 Nov 6-8 |
16 |
11 |
20 |
34 |
12 |
3 |
4 |
60 |
How much do you rely on each of the following sources of income today -- is it a major source of income, a minor source of income, or not a source at all? How about -- [READ A-I IN ORDER]?
BASED ON --180-- RETIRED ADULTS
A. Social Security
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
2002 Apr 8-11 |
58% |
22% |
18% |
2% |
B. A 401(k), IRA, Keogh, or other retirement savings account
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
2002 Apr 8-11 |
19% |
23% |
56% |
2% |
C. Individual stock or stock mutual fund investments
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
2002 Apr 8-11 |
15% |
31% |
52% |
2% |
D. Money from an inheritance
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
2002 Apr 8-11 |
4% |
11% |
84% |
1% |
E. Other savings such as a regular savings account or CDs
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
2002 Apr 8-11 |
15% |
33% |
51% |
1% |
F. A work-sponsored pension plan
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
2002 Apr 8-11 |
29% |
16% |
51% |
4% |
G. Rent and royalties
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
2002 Apr 8-11 |
6% |
13% |
80% |
1% |
H. Annuities or insurance plans
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
2002 Apr 8-11 |
8% |
21% |
69% |
2% |
I. Part-time work
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
2002 Apr 8-11 |
3% |
14% |
82% |
1% |
J. The equity you have built up in your home
|
Major source |
Minor source |
Not a source |
No opinion |
|
|
2002 Apr 8-11 |
18% |
14% |
60% |
8% |
At what age did you retire?
BASED ON --180-- RETIRED ADULTS
|
Under |
|
|
|
Over |
No opinion |
|
|
|
% |
% |
% |
% |
% |
% |
||
|
2002 Apr 8-11 |
19 |
19 |
34 |
13 |
11 |
4 |
59 |
|
1993 Apr |
27 |
18 |
25 |
14 |
11 |
5 |
57 |
|
1992 Apr |
21 |
16 |
36 |
13 |
8 |
6 |
58 |
|
1991 Apr |
28 |
12 |
36 |
11 |
7 |
6 |
57 |
