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Despite the pandemic, most Americans are still optimistic about a comfortable retirement, but inflation is the main concern for those not so prepared.
That’s according to the Employee Benefits Research Institute and Greenwald Research’s 32nd Annual Retirement Confidence Survey, which polled 2,677 workers and retirees in January.
“Even with concerns about the pandemic and rising prices, on the whole, American workers and retirees still feel positive about their retirement,” said Craig Copeland, director of benefits research. wealth at EBRI.
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The 2022 results remain stable compared to 2021, with more than 7 in 10 workers saying they are at least “fairly confident” about retirement savings, including almost a third who feel “very confident”.
Some 8 in 10 retirees believe they will have enough money to live comfortably through their golden years, according to the survey. But the pandemic has clouded the optimism of a third of workers and a quarter of retirees.
“Americans who are most likely to think their future looks bleak since the pandemic are those who were already pessimistic about their future, due to lower income, debt problems or poorer health status” , Copeland said.
Unsurprisingly, inflation and rising expenses are the main concern of workers and retirees who feel less confident about retirement.
When asked an open-ended question about the specific reason for declining retirement confidence, half cited inflation and the rising cost of living, said Lisa Greenwald, CEO of Greenwald. Research.
Annual inflation has risen since the January survey, hitting 8.5% in March, according to the US Department of Labor, affecting the price of everyday expenses like groceries, gas and housing.
However, spending changes in retirement may lessen the sting of some rising costs, according to JP Morgan’s Guide to Retirement 2022. Excluding health care, retirees may spend less on other expenses, such as food and fuel.
While the Pension Confidence survey showed most spending by retirees was as expected, 1 in 3 said they spent more than expected, up from a quarter in 2021, the survey found.
“This could reflect increased use and desire for travel and recreation as the pandemic subsides,” Greenwald said. “It may also reflect inflation and the rising cost of travel and entertainment for some.
“While it is unclear what is the reason for the increase in spending, a strong majority of retirees still feel that their retirement lifestyle and spending are on track,” she said. added.