A new survey released on Wednesday shows that the dream of retirement may be falling by the wayside, a victim of both financial inequality and better quality of life in later years.
According to a new survey only 21% of Americans say they plan to stop working at the age of retirement. 61% of Americans expect to continue working past the age of 65 or do not plan to retire at all.
The Transamerica Center for Retirement Studies (TCRS) surveyed 4,550 full-time and part-time workers about their retirement and savings plans.
One in five said they would continue working as long as possible and 41% planned to reduce their hours.
“Today’s workers recognize they need to save and self-fund a greater portion of their retirement income,” said Catherine Collinson, president of TCRS. “The long-held view that retirement is a moment in time when people reach a certain age, immediately stop working, fully retire, and begin pursuing their dreams is more myth than reality.”
The move of corporate America away from defined benefit pensions plans is a key driver of the findings. Under such plans workers were paid fixed sums for the rest of their life, leading to a predictable income stream upon retirement.
Today's defined contribution plans only stipulate how much is put into a plan, not what is paid out. In an environment of pathetically low interest rates and high money management fees workers are left with little in the way of pensions and so are looking to keep working as long as possible.