Americans Overconfident with Retirement Plans

They may not be planning luxury vacations yet but the well to do of America are confident that their retirement plans will support their lifestyle in their late 60s. This has been revealed by a survey conducted by Charles Schwab, the 40-year old financial firm known for recommending smart investments to the individual investor.

retirementThe survey reveals that while 84% of people have a retirement plan in place, 80% are confident their plans will work.

An interesting revelation is that 39% people do not intend working even part-time after their retirement. Is this a sign of confidence or over confidence.

According to the survey, people seem to have overestimated their plans. While the current average annual income is USD 115,000, the average retirement plan aims at getting $66,000 per year. This clearly goes on to show that there is a gap in understanding what life after retirement requires.

One wonders if these people have kept in mind the number of years they would need a good plan for. The Schwab survey mentions that people intend to retire at 67 and expect to live another 20-21 years.

The survey has been conducted on a sample size of a little over 1800 investors over nine markets. The ages of the people surveyed vary between 25 and 80. It will be interesting to see if young America’s plans differ from the old America. For now, we know that people don’t seem to be as prepared as they should be.

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