BMO Harris Premier Services released the results of a study that examined retired and non-retired Arizonans’ views on retirement. According to the study, 47 percent do not know how much they will need to fund their ideal retirement lifestyle and 33 percent do not know when they will retire.
The study also found that:
- The average age for non-retirees to start saving for retirement is 29
- Fifty-three percent of Arizonans have put some thought into what their retirement will look like, but only 22 percent have a definite idea and 26 percent have not thought about it at all.
- Sixty-six percent of non-retirees in Arizona under the age of 60 are taking steps to save for retirement through a 401(k) and/or IRA account (75 percent).
When asked what younger Arizonans plan to do once retired, 58 percent said they would like to relax and 57 percent plan to spend their golden years with friends and family. Other plans include traveling (43 percent) and focusing on hobbies (41 percent). A quarter (26 percent) would like to continue working in retirement – whether it be part-time in their current career (20 percent) or starting a new business (7 percent).
“Arizonans seem to be taking many of the right steps towards saving for retirement,” said Kent Seacat, regional manager, Financial Advisory Services, BMO Harris Financial. “However, it’s important for them to remember to think about the lifestyle they want to have in retirement and how much they’ll need to save in order to achieve it.”
Seacat added that there is not a defined amount that Americans should aim to have in their retirement fund. “A financial advisor can work with you to create a personalized financial plan with a retirement component that best reflects the lifestyle you want to have in your later years.”
Lessons Learned: Retirees Look Back
The study also polled current Arizonan retirees on what challenges they have faced in retirement. It found that, although 76 percent are satisfied with their retirement lifestyle, 24 percent are unsatisfied with some aspects of their lives. Among those unsatisfied retirees, 77 percent cited lack of funds and 55 percent identified health issues as their top challenges in retirement.
When asked what financial wisdom they would pass down to younger Americans, retirees in Arizona recommended:
- Opening a 401(k) and/or IRA account as soon as possible and making regular contributions (88 percent).
- Talking to their partner to ensure they both are on the same page with what they want to do in retirement (85 percent).
- Creating a financial plan that includes a retirement component (89 percent).
“It’s encouraging to see that Arizona’s retirees are satisfied with their retirement lifestyle – younger generations can achieve this same satisfaction in their golden years with proper financial planning and preparation,” said Sue Hasenstein, regional sales manager, BMO Premier Services, BMO Harris Bank. “We can learn a lot from today’s retirees– their retirement planning process and learnings can serve as a model for future generations as they plan their golden years.”
Key National Findings:
- According to the study 75 percent of Americans are taking steps to save for their golden years through a 401(k) or IRA account and 29 is the average age for Americans to start saving for retirement
- Over half (57 percent) of Americans do not know how much they will need to fund their ideal retirement lifestyle and 44 percent do not know when they will retire.
- Forty-three percent of Americans have put some thought into what their retirement will look like but only 19 percent have a definite idea and 38 percent have not thought about it at all.
- When asked what financial wisdom they would pass down to younger Americans, retirees recommended, opening a 401(k) and/or IRA account and making regular contributions (93 percent), talking to their partner to ensure they both are on the same page with their retirement objectives (91 percent) and making it a priority to pay off their mortgage faster (79 percent).