planning for retirement (dallas salisbury)
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Striving for a Secure RetirementStriving for a Secure Retirement
Dallas L. SalisburyPresident & CEO
Employee Benefit Research Institute
www.EBRI.org www.ChoosetoSave.org
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2EBRI.org
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The Secure Retirement ChallengesThe Secure Retirement Challenges
Low Social Security benefitsLow Social Security benefits
Limited retiree medical benefitsLimited retiree medical benefits
Limited DB annuity benefitsLimited DB annuity benefits
DC NonDC Non--participationparticipation
DC No automatic base contributionsDC No automatic base contributions
DC Inefficient match formulasDC Inefficient match formulas
DC Low worker contribution ratesDC Low worker contribution rates
DC NonDC Non--growth of contribution ratesgrowth of contribution rates
DC NonDC Non--diversified investingdiversified investingDC NonDC Non--rebalancingrebalancing
Financial Literacy and EducationFinancial Literacy and Education
Public PolicyPublic Policy
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4EBRI.org
5 %
43%
13%
0%
11%
7%
1 %
11% 11%
19%
Workers Retirees
In total, about how much money would you say you currently have in savings and investments,not including the value of your primary residence? Please include savings, certificates of deposit,stocks, bonds, mutual funds, workplace retirement plans, and other investments (Workersresponding n=818, Retirees responding n=190)
Most workers have little in savings.
Less than$ 5,000
$ 5,000-$49,999
$50,000-$99,999
$100,000-$ 49,999
$ 50,000or more
Source: Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc.,2005 Retirement Confidence Survey
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7EBRI.org
32%
23%
3 %
21%21% 22%
18%
21%
16%
8%
11%
6% 7%
11%
%
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8EBRI.org
Of hose no longer work ng for pay, more han half areunable o work.
11
4
4
4
12
23
24
2
Could you please ell me he reason why you are no longer work ng? (Re rees no longerwork ng for pay n re remen , n=2 ) (mul ple responses accep ed)
No heal hy enough
Old/ oo old
S ll help when needed
O her
Don need o work
No longer wan o work
Los job
Can f nd work you l ke
Source: Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc.,2005 Retirement Confidence Survey
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9EBRI.org
%
1 %1 %
1%
17%
3%
%
3%%
%
38%
%
1 %
5%%
Workers Retirees
bout what percentage of your pre-retirement household income do you think you (and yourspouse) will need to live comfortably in retirement? By pre-retirement income, I mean your
household income right before you retire. (Workers n=5 )bout what percentage of your pre-retirement income is your current household income?
(Retirees n= 5 )
3 in 5 workers expect to live comfortably on 7 % or lessof their pre-retirement income; most retirees have more.
Less than5 %
bout95-1 5%
1 5%or more
Dont knowRefused
bout5 -7 %
bout7 -85%
bout85-95%
Lower(Dont
know %)
Source: Employee Benefit Research Institute and Mathew Greenwald & Associates, Inc.,2005 Retirement Confidence Survey
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Savings Needed for Employment-Based
Benefits Access-Only Plans at Age 65 in 2015
(assumes 7% premium growth)
Age at Death Premium Only Premium + out-of-
pocket
80 $160,000 $230,000
85 $223,000 $321,000
90 $296,000 $426,000
95 $381,000 $548,000
100 $477,000 $687,000
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EBRI
2121 K Street NW, Suite 600
Washington, DC 20037
Phone: 202-659-0670Fax: 202-775-6312
www.ebri.org