BUSINESS: Research + Stats American Middle-Class Is Facing Risky Retirement Outlook By Staff Tuesday, September 3, 2024 4:00 PM A new study sheds light on the middle class’s personal retirement outlook. According to the survey report, titled The Retirement Outlook of the American Middle-Class, released by the Transamerica Center for Retirement Studies, just one in five people in the U.S. middle class are very confident in their ability to fully retire or maintain a comfortable lifestyle throughout their retirement. “The middle class symbolizes the American dream,” said Catherine Collinson, CEO and president of Transamerica Institute and TCRS. “In today’s chaotic environment, what are the middle class’s hopes, dreams and retirement prospects? What support is needed from policymakers to help ensure they can retire with dignity? Our new report seeks to answer these pressing questions.” The survey examined the well-being, personal finances and retirement expectations and preparations of U.S. middle-class residents with an income between $50,000 and $199,999. It outlines that 67 percent of the middle class’s priorities are enjoying life, while 62 percent said they are focused on being healthy. Approximately 45 percent said they are planning for their financial future, while 28 percent said they are leading a more sustainable life. When planning for retirement, experts advise people in the middle class to think long-term, as more Americans are living into their 90s. The survey noted that people in the middle class are facing financial priorities that include paying off debt, with 59 percent of respondents saying they are working on paying off debt. Nearly 50 percent said they are saving or continuing to save for retirement, while 42 percent said they are working on building retirement savings. Nearly half of the middle class expects to work beyond traditional retirement age, with 34 percent of respondents saying they expect to retire after age 65 and 15 percent noting they do not plan to retire. “America’s middle class is navigating the turbulent post-pandemic economy and high rates of inflation. They are focused on their health and financial well-being, but many are at risk of not achieving a financially secure retirement,” said Collinson. More than half of the survey’s respondents said they plan to continue working after they retire. Meanwhile, half of retirees said they retired sooner than planned, at an average age of 62, due to employment or health-related issues. Retirement fears varied widely among the middle class, with 40 percent of respondents saying they were concerned about outliving their savings and investments. Similarly, 40 percent said they were concerned about declining health that requires long-term care. Nearly 40 percent said they were worried that Social Security will be reduced or cease to exist in the future, while many respondents said they were concerned about cognitive decline, dementia, Alzheimer’s disease and possible long-term care costs at 39 percent and 33 percent, respectively. “By gaining knowledge and engaging in financial planning, the middle class can make better informed decisions in their daily lives which could, in turn, improve their long-term retirement prospects. However, they also need better, stronger societal support,” said Collinson. “Policymakers will pave the way for modernizing our retirement system for current and future generations.”