November 20, 1998
Many unhappy with projected retirement incomeWEST LAFAYETTE, Ind. -- The vast majority of working people are not satisfied with the amount of money they expect to have for retirement, according to research by a Purdue University expert on retirement finances.
In a study of self-employed and wage-and-salary workers, Sharon DeVaney, assistant professor of consumer sciences and retailing, found that only 15 percent of persons in each group were satisfied with their expected pension and Social Security incomes.
"Most people these days plan to work some after retirement. However, if poor health inhibits their ability to work later on, then their financial well-being may be in jeopardy," she suggests.
A recent poll from the American Association of Retired Persons shows that eight out of 10 baby boomers plan to keep working at least part-time after retirement.
Retirement income traditionally has been viewed as a three-legged stool consisting of Social Security, employer-provided pensions and private savings. "Many people believe that the three legs of the stool have weakened and that a fourth leg -- earnings after retirement -- will become increasingly necessary," DeVaney says.
Her study used data from the 1995 Survey of Consumer Finances, a triennial cross-sectional survey sponsored by the Federal Reserve Board and the Department of the Treasury. The study included approximately 1,000 self-employed workers and about 2,000 wage-and-salary workers.
DeVaney found that older workers were happier than younger workers. "As people age, they are more likely to save for retirement, which increases their satisfaction," she says.
The findings were presented at the November meeting of the Association for Financial Counseling and Planning Education.
Source: Sharon DeVaney, (765) 494-8300; e-mail, email@example.com
Writer: Beth Forbes, (765) 494-9723; e-mail, firstname.lastname@example.org
Purdue News Service: (765) 494-2096; e-mail, email@example.com
NOTE TO JOURNALISTS: A copy of Sharon DeVaney's study on retirement income satisfaction is available from Beth Forbes at the Purdue News Service, (765) 494-9723.