A new survey by American Century Investments found that retirement savings is the biggest financial goal for all savings plan participants, no matter their age, gender or income level, but confidence on turning their savings into income wavered.
The 2024 Annual Retirement Survey found that 94% of respondents between 25 and 39, 98% of those between 40 and 54, and 99% of those between 55 and 65 saw retirement savings as a priority. And 66% said they knew how much to withdraw from their assets to cover their expenses, 65% said they knew how to figure out the impact of a large withdrawal on their savings and 62% said they knew how much to withdraw each year to ensure their money lasts their lifetime.
But under half said they knew the best way to make that happen, given their specific portfolio, the survey said.
“Two in three are confident about the amount of money they would need to withdraw to cover their living expenses and the impact of large withdrawals,” the survey report said. “[But] a majority will need some help withdrawing money from their retirement accounts.”
That represents a drop from the 61% in 2022 who said they’d need help figuring out how to withdraw their money. This might be due to the fact that more than half of the participants now said they use some kind of financial advisor, whether through their workplace plan or outside of it. And if they didn’t currently work with an advisor, another 39% of those said they plan do so in the future, the survey said.
The greatest concerns of the participants included the nagging feeling that they could have saved more, which increased from 48% among the youngest demographic to 53% among the oldest.
That was balanced by 39% of the youngest participants being worried that they’re not invested correctly for their goals to shrinking to just 31% of respondents between 55 and 70 years old who felt the same.
Overall, 36% of respondents said they expect their standard of living to be better in retirement than it is pre-retirement, and the vast majority—at least 56%—understood that some investment risk was necessary to see portfolio growth.
The survey was conducted in June and was completed by 1,505 respondents between 25 and 65, all of whom were working full-time and participating in their employer’s retirement plan.
This was the 10th annual survey, and slightly fewer respondents than in the past—27% compared with 31% last year and 32% the year before—said they would roll their assets out of their workplace plan into an IRA. Instead, a corresponding bump was seen in those who intended to take the plan money and invest it in a different option—22% compared with 20% last year and 16% the year before.
And finally, about half said they felt they needed to replace between 40% and 70% of their pre-retirement income to achieve the same standard of living.