Saving for Retirement ‘Not Main Priority’ Say Four in Five Working Americans
January 20 2015 - 8:19AM
Business Wire
*** HSBC survey finds that half can’t afford to
adequately plan for a comfortable retirement as they juggle growing
financial responsibilities and accumulated debt ***
A majority of working-age Americans admit they are not
prioritizing retirement planning and place greater importance on
more immediate financial concerns, potentially resulting in
financial hardship in the long-term, according to new research out
today from HSBC.
The global study finds that for 81 percent of working-age
Americans, saving for retirement is not their main priority, even
as 76 percent have seen retirement savings impacted at some point
by a significant life event such as buying a home, becoming
unemployed, divorce or illness, underscoring the power of planning
adequately and at an early age for life after work.
This latest report titled: The Future of Retirement: A balancing
act is the 10th in an annual series focused on international
attitudes towards aging and retirement. It is based on a survey of
more than 16,000 people from 15 countries and territories1 between
August and September 2014. Its findings depict a world juggling a
growing amount of financial responsibilities and fearful of not
being able to maintain a comfortable lifestyle upon retirement.
The research discovers that personal debt accumulated earlier in
life, and particularly in these recent tough economic times,
continues to impact the ability to save for the future. The report
also uncovered other notable reasons people do not prepare
adequately for retirement:
- More immediate financial
concerns: Paying off a mortgage or other debts is the biggest
barrier (57 percent among Americans; 46 percent globally)
preventing working-age people from saving adequately for life after
work. Americans are more preoccupied with paying off other debts
(51 percent) and a mortgage (25 percent) than most other countries
while a third (33 percent) have either stopped or reduced savings
for their children’s education to prioritize debt repayments.
- Unaware of how much to save:
Three in 10 (29 percent) retirees worldwide who did not prepare
adequately for a comfortable retirement admit they did not know how
much they needed to save. This number rises in the U.S. where 41
percent say they did not possess the proper knowledge.
- Didn’t start saving early
enough: Those who begin retirement planning when they are older
than 30 have waited too long, say more than a third (38 percent) of
the world’s retirees. More retirees in the U.S. (47 percent), U.K.
(62 percent), Australia (57 percent) and Canada (45 percent)
recognize the need to start planning by 30 in order to maintain a
similar standard of living after work. However, two-thirds (65
percent) of retirees globally who failed to prepare adequately for
a comfortable retirement say they did not realize this until they
had fully retired.
Working-age Americans outpace the rest of the world when it
comes to planning for later life, as 75 percent report saving for
retirement compared to the international average of 62 percent.
“There’s no ‘one-size-fits-all’ approach to retirement, but
there are ways that everyone can plan for a better one,” said
Andrew Ireland, head of wealth management, HSBC Bank USA, N.A.
“This includes starting as early as possible, figuring out how much
you’ll need to fund the lifestyle you want and making sure you’re
properly covered for unexpected life events.”
The Future of Retirement report concludes that financial
confidence around the world is now on the rise. As the U.S.
continues to recover from the global economic downturn, 41 percent
of pre-retirees feel more optimistic about their financial
prospects than they did one year ago.
Still, almost half (45 percent) of working-age people globally
believe the cost of living is increasing faster than their
income.
Note to editors
1. Australia, Brazil, Canada, France, Hong Kong, India,
Indonesia, Malaysia, Mexico, Singapore, Taiwan, Turkey, United Arab
Emirates, United Kingdom, United States.
About the report:
HSBC's The Future of Retirement report is a world-leading
independent research study into global retirement trends. It
provides authoritative insights into the key issues associated with
aging populations and increasing life expectancy around the world.
The latest global report, A balancing act, is the 10th in the
series and is based on an online survey of over 16,000 people in 15
countries and territories. Since The Future of Retirement program
began in 2005, more than 142,000 people worldwide have been
surveyed.
U.S. findings are based on a nationally representative survey of
1,000 people of working age (25 and over) and in retirement. It was
conducted online by Ipsos MORI between August and September
2014.
For more information about The Future of Retirement, and to view
all previous global and country reports, visit
www.hsbc.com/retirement.
About HSBC:
HSBC Holdings plc, the parent company of the HSBC Group, is
headquartered in London. The Group serves customers worldwide from
more than 6,200 offices in 74 countries and territories in Europe,
the Asia-Pacific region, North and Latin America, and the Middle
East and North Africa. With assets of US$2,729bn at 30 September
2014, HSBC is one of the world's largest banking and financial
services organisations.
HSBC Bank USA, National Association (HSBC Bank USA, N.A.), with
total assets of US $168.4bn at 30 September 2014 (US GAAP), serves
about 2.4 million customers through retail banking and wealth
management, commercial banking, private banking, asset management,
and global banking and markets segments. It operates more than 240
bank branches throughout the United States. There are over 155 in
New York State as well as branches in: California; Connecticut;
Delaware; Washington, D.C.; Florida; Maryland; New Jersey;
Pennsylvania; Virginia; and Washington State. HSBC Bank USA, N.A.
is the principal subsidiary of HSBC USA Inc., an indirect,
wholly-owned subsidiary of HSBC North America Holdings Inc. HSBC
Bank USA, N.A. is a member of the FDIC.
Media inquiries to:HSBCRobert Sherman,
212-525-6901robert.a.sherman@us.hsbc.com
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