The 2014 Retirement Confidence Survey from the Employee Retirement Benefit Institute highlights that Americans are feeling more confident about their retirement for the first time in seven years. Although the retirement confidence level is still well below its 27% peak in 2007, it is up significantly from last year’s 13%, as in 2014 around 18% of survey respondents said they were very confident in having enough money to live comfortably throughout retirement.
More details from EBRI’s 2014 Retirement Confidence Survey
The new survey also showed that retiree confidence in having enough money for a comfortable retirement increased significantly in 2014. Almost 28% of surveyed retirees report that they are very confident, up from close to 18% in 2013.
Not surprisingly, retirement confidence is clearly related to retirement plan participation, whether in a defined contribution plan, defined benefit plan or individual retirement account (IRA). Of particular note, those reporting they or their spouse have money in a defined contribution plan or IRA or have a defined benefit plan from a past or present employer are more than twice as likely as those without any retirement plan to be very confident in their retirement (24% of those with a plan vs. 9% without a plan).
Furthermore, the increase in confidence between 2013 and 2014 occurred largely among those with a plan. There was an increase from just 14% very confident in 2013 to 24% in 2014 for those with a plan, compared with unchanged percentages among those without a plan of 10% very confident in 2013 and 9% in 2014. Also of note, workers without a retirement plan are four times more likely to say they are not at all confident about their financial security in retirement (11% with a plan compared to 46% without a plan).
Amount of debt impacts confidence
Somewhat puzzlingly, despite a general increase in confidence about retirement, a high number of both workers and retirees also report problems with debt. Around 20% of workers who responded to the survey and 16% of retirees described their debt situation as a major problem. However, as you can see from Figure 7, debt levels have been relatively stable over the past few years.
The full survey can be found here RCS14.FS-1.Conf.Final