Report Assesses Whether People Are Prepared for Retirement A RECENT REPORT by the Center for Retirement Research at Boston College in Massachusetts examined if people have a good sense of whether they are prepared for retirement. “Do their expectations match the reality they face?” asks the study titled How Well Do People Perceive Their Retirement Preparedness? “Since the Great Recession, the calculations show that even if households work to age 65 and annuitize all their financial assets, including the receipts from reverse mortgages on their homes, roughly half of households are at risk of being unable to maintain their standard of living,” the report says. “… Interestingly, higher-income households are most likely to underestimate their risk.” Here is a closer look at some of the numbers behind the National Retirement Risk Index (NRRI). SOURCE: https://crr.bc.edu/how-well-do-people-perceive-their-retirement-preparedness 50%: High-income households that correctly assess they “are not at risk.” 24%: Low-income households that correctly assess they are “not at risk.” 32%: High-income households that are “not worried enough.” 47%: However, the NRRI says this is the percentage actually “at risk” in 2019. 34%: Households that self-reported they were “at risk” of not being financially prepared for retirement in 2019. 26%: Low-income households that are “not worried enough.” 41%: Middle-income households that correctly assess they “are not at risk.” Numbers 26%: Middle-income households that are “not worried enough.” $100,000: A reason for the disconnect. That “looks like a lot of money to many people even though it provides only about $617 per month in retirement income.” 36 REVERSE MORTGAGE / NOVEMBER–DECEMBER 2023
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