A new study from Allianz Life Insurance of North America finds that the majority of baby boomers believe there is a retirement crisis in the United States, and they are unprepared to deal with it.
The 2011 Reclaiming the Future study was originally conducted in 2010 with more than 3,000 participants. Aliianz surveyed 439 of the same participants to see how attitudes had changed in the last year.
When asked, "Do you believe there is a retirement crisis in this country?" 92 percent of the respondents answered either "somewhat" or "absolutely." Among those in their late 40s (the younger of the survey's participants), that number rose to 97 percent, and 100 percent of the respondents with lower incomes ($30,000-$45,000 and investable assets of under $50,000) agreed that the U.S. is facing a retirement crisis.
This financial crisis has left many unprepared for what lies ahead. Thirty-five percent of respondants feel unprepared for retirement, and among those aged 44-54, that number jumps to 51 percent. For those in lower income brackets, the percentage becomes a staggering 77 percent. In fact, 56 percent of those aged 44-54 said that recent market events have caused them to question when — if ever — they can retire.
Boomers are also concerned about the size of their savings. Slightly more than half (57 percent) said they're concerned their nest egg might not be big enough, while 47 are afraid they won't be able to cover their basic expenses. Among those with lower income levels, this number jumps to 77 percent.
The biggest fear for baby boomers is longevity; in fact, 61 percent of them fear outliving their savings more than they fear death itself. That number climbed to 77 percent for those aged 44-49, and rose even higher (82 percent) for those in their late 40s who had dependents. Boomers are also concerned about the future of Social Security, with 39 percent speculating that it's more likely they'll be hit by lightening than they'll see the full amount their owed from Social Security.
However, there is a light at the end of the tunnel for many boomers: the annuity. When describing their dream product, 69 percent said they'd like something that was guaranteed not to lose value over a product that provided a high return. Additionally, 56 percent preferred an annuity-like product (moderate growth opportunity, guaranteed monthly income for life, but limited access) to a product that provides total access but risks running out of money. Among the mass affluent, this number rose to 77 percent.
Still, those working in the annuity industry have a long way to go. A large majority of repsondants disliked the word "annuity," even after describing an annuity-like product as their ideal retirement solution.
This article originally appeared on the BenefitsPro web site, a Summit Business Media publication.