Pressing concerns for Boomers thinking of Retiring

A new boomer survey conducted by Merrill Lynch and Ken Dychtwald’s Age Wave asked probing questions about what boomers plan to do with their “longevity bonus.” Completed in January 2013, the study is based on a nationwide survey of more than 6,300 respondents age 45 and older. What they learned may surprise you. The survey results are summarized in “Americans’ Perspectives on New Retirement Realities and the Longevity Bonus,” downloadable  here 

Findings from the study reveal new insights into people's approaches to and thoughts about retirement, such as:

Finances: When it comes to financial goals, achieving peace of mind is seven times more important to Boomers than accumulating wealth.

Reinvention: Today's retirees are largely not retiring — they view the "longevity bonus" as a chance to explore new options, pursue old dreams and live life to the fullest. Retirement used to mean the end of work. Today, seven out of ten pre-retirees say they would ideally like to include some work in their retirement years. Most are seeking flexible work arrangements, such as part-time work (39%) or going back and forth between periods of work and leisure (24%). In fact, working in later life is increasingly becoming the norm. For example, between 2006 and 2011, only the age 55+ workforce grew, while during the same time, millions of younger workers left or were displaced from the workforce 

Family Interdependencies: With today's economic uncertainty, and with many family members struggling financially, balancing an individual's or couple's retirement needs with the needs of parents, siblings, children and grandchildren is a growing and complicated challenge. The term “sandwich generation” was coined in the 1980s to describe Boomers who needed to care for both children and aging parents. Today, due in part to recent economic hardships, the sandwich generation is transforming into a family cube, with support extending side to side as well as up and down. In our national survey, we asked people age 45+ whether they expect to provide support to family members

Connections: Today's retirees are finding comfort, meaning and safety in connections with family, friends, communities and trusted guides. The end of work also reveals an often unforeseen surprise:  the importance of friendships and relationships with fellow workers. Although pre-retirees think a reliable income is what they'll miss most when leaving work, retirees tell us that it is the social connections that they miss most after they retire. Traditional Values: Retirees today define happiness not in terms of dollars but in terms of new experiences, peace of mind, helping family and making a difference.

The study also offers new insights about sources of concern and the need for guidance, including:

Health Disruptions: Health problems and the cost of healthcare now top the list of retirement worries — even more so among the affluent. Unanticipated medical expenses can derail years of retirement preparation. Sixty percent of bankruptcies in the U.S. today are related to medical bills  and retirees who are struggling with health issues are twice as likely to say they are in a financial crisis. Wealthier pre-retirees and retirees are even more likely to rank healthcare expenses as their top financial worry in retirement.

Falling Short: People don't know exactly how long they will live and feel insecure about their ability to support a very long life.

Home and Community: People are concerned about where they should live in retirement, as well as the need to support adult children and parents' housing and eldercare needs. Multigenerational households are on the rise, doubling since 1980 to more than one in five households. With this in mind, we believe these are the four mainstays of family support:

1.    Financial. 43% expect to provide direct financial support, such as writing a check or providing a loan to a family member.

2.    Housing. 38% expect to provide or help a family member pay for a place to live.

3.    Education. 30% expect to help pay education expenses for a family member.

4.    Healthcare. 25% expect to pay for or help manage a family member’s healthcare or long-term care needs.

The study reveals a strong desire among those approaching and in retirement to know more about the challenges and opportunities that lie ahead, to gain greater clarity about what they hope to achieve, and to understand what is possible