While many investors say they've already lowered their retirement lifestyle expectations, some may need to lower it more because they have underestimated how much money they will need, according to BlackRock's Investor Watch survey released today.
Forty-two percent of non-retired survey respondents say they have lowered their expectations for their retirement lifestyle and 50 percent say they've either pushed their planned retirement date back or are unsure when they'll retire.
Almost 50 percent of investors queried acknowledged that they've made their retirement planning a relatively low priority.
Fifty-one percent of non-retired investors surveyed say they know how much to save to cover their full retirement. In contrast, 37 percent of respondents say they're not confident they will have achieved the annual retirement income they expected to need.
About one in three respondents expect to spend less than 15 years in retirement, despite the fact that a healthy couple aged 65 in the U.S. has a 50 percent chance that at least one of them will live to the age of 92. Assuming retirement at age 65, that translates into 27 years of retirement.
"It's common for investors to underestimate how much money they will need to cover themselves for their life when retired," Frank Purcell, head of BlackRock's U.S. retail business said in a statement. "Retirement today is not a single life stage, and the new reality is that it could cover a 25-year period or longer, during which time an individual's needs, goals and risk tolerance are likely to change."
Retirement planning is also low on people's financial priority list, according to the survey. Planning for retirement ranks third among the activities investors said they spent their free time on last year, eclipsed by taking vacations and exercising at the gym, respectively.
The survey was produced with the help of research firm Market Strategies International. The Internet survey queried 671 investors-294 retired and 377 non-retired-between Sept. 26 and Oct. 9. All investors surveyed work with a financial advisor and all had $250,000 or more in investable assets.
BlackRock is an investment, risk management and advisory services firm with $3.7 trillion assets under management as of Sept. 30.