New Survey Shows Nearly One Third of Adult Americans Who Would Like to Retire Do Not Know if They Can/Do Not Think They Can, While Younger Adults Have an Unrealistic Perception of How Much Money They Will Need to Retire

WHITE PLAINS, N.Y., Nov. 12, 2012 /PRNewswire/ -- A new Pentegra Retirement Services survey released today, conducted online by Harris Interactive on its behalf in September 2012, revealed that nearly one-third (32%) of U.S. adults who would like to retire do not know if they will be able to retire or do not believe they will ever be able to retire. In addition only 19% -- nearly one in five adults¹ -- said that they will be able to retire at age 65. 

Significant additional findings of the Pentegra survey showed that young adults have an "unrealistic perception of how much money they need to retire," according to Rich Rausser, Senior Vice President of Client Services at Pentegra. Adults² ages 35 to 54 (27%) are more likely than those ages 18 to 34 (18%) to say they will need more than $1 million to retire. Those ages 18 to 34 (62%) are more likely than those ages 35 to 54 (45%) to think that they will need only up to $500,000 to retire. 

Rausser says, "Younger adults new in the job market are likely making a lower salary and basing their retirement thinking on where they are now in their life, but they need to realize that their cost of living and expenses later on will be significantly different." 

In more optimistic news, the Pentegra survey revealed that the majority of U.S. adults (92%) feel that some of the average person's paycheck needs to go towards retirement planning. On average, they believe that 14% should be contributed from each paycheck towards retirement.  

Rausser explains "This is much higher than Pentegra had predicted and we are thrilled that people have solid hopes and plans for their future. However, this number can scare people away with the thinking that they could never realistically put that much money away each paycheck – 14% is overwhelming for some people. The important lesson here is that it doesn't have to be all or nothing."

Other highlights of the Pentegra (www.pentegra.com) survey include:

• 21% of adults with children under age 18 present in their households admit they have not planned for retirement whereas only 12% of adults with no children present admit they have not planned for retirement.
• Only 28% of adults who have planned for retirement were helped in their preparation by their parents. 
• A full one-third (33%) of those who have planned for retirement say that they were helped by a professional financial advisor. 
• Over one quarter of adults (28%) who have planned for their retirement says that NO ONE helped them prepare for this. 
• 31% of those are currently retired say that NO ONE helped them plan for it. 
• Women¹ (21%) are more likely to be unsure about their anticipated retirement age than men (13%).
• On average, adults¹ ages 18 to 34 believe they will be able to retire at age 62; adults ages 35 to 54 estimate retirement at age 65; and those over 55, estimate retirement at age 67.
• Over three quarters (78%) of adults planning to retire feel they need up to $1 million to retire. Women (83%) are more likely to feel this way than men (72%).
• While 22% believe they will need more than $1 million to retire, men (28%) are more likely than women (17%) to feel this way. 

Rausser explains, "For so many Americans planning for retirement seems too enormous to tackle and it feels like it is already too late. But this is not so. Start with 1%, 2%, 3% of salary. Commit to a plan of auto-escalation, each year increasing to your retirement plan by 1%. With salary increases and the tax break associated with employee deferrals, it should be fairly painless. And the numbers will budge. It is never too late."

Saving just $4 a week, over the course of 25 years, can boost your retirement savings by $16,608.  Saving $30 a week can boost those savings by a staggering $124,469 over that same 25-year period. 

"The more time your savings have to grow, the more you can take advantage of the effect of compounding. Compounding is what happens when you earn money not just on contributions to your account but also on the earnings themselves. It is interest on interest, and that means your account grows faster," says Rausser. 

Survey Methodology
This survey was conducted online within the United States by Harris Interactive on behalf of Pentegra Retirement Services from September 24-26, 2012 among 2,397 U.S. adult adults ages 18 and older, among whom 1,927 are not already retired. This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated. For complete survey methodology, including weighting variables go to http://www.pentegra.com/HarrisSurvey2012.pdf.

About Pentegra
Pentegra Retirement Services is a leading provider of retirement plan solutions to organizations nationwide. Founded by the Federal Home Loan Bank System in 1943, Pentegra offers a full range of retirement programs, including 401(k) plans, Defined Benefit Pension plans, Cash Balance plans, 412(e)(3) Fully Insured Defined Benefit plans, Split Funded Defined Benefit plans, KSOPs, ESOPs, Profit Sharing plans, Age-Weighted plans, New Comparability plans, 457(b) and 457(f) plans, 403(b) plans, 401(a) plans, Section 79 plans, Non-qualified Executive Benefit and Director plans, benefits financing solutions using BOLI and a broad array of TPA services. For more information, go to www.pentegra.com

¹Not already retired and would like to retire
²Not already retired and plan to retire

Media Contact:  Rodi Rosensweig, [email protected]; 203/270-8929

SOURCE Pentegra Retirement Services