Ten years after the financial crisis and recession that began in 2007, only two percent of middle-income boomers feel the economy has fully recovered, while 65 percent believe they have not personally benefited at all from any recovery, according to a new study commissioned by Bankers Life Center for a Secure Retirement (CSR). During this decade, baby boomers have struggled to rebound financially, and while nearly all surveyed said they still plan to retire, they have readjusted retirement expectations to meet their new reality.
The study, "10 Years After the Crisis: Middle-Income Boomers Rebounding But Not Recovered," reports that among boomers who believe they have not personally benefitted from any recovery, more than half say their savings are lower now than before the crisis, and four in 10 are not earning as much. Adding to their financial burden, before the crisis, 45 percent of middle-income boomers—those with an annual household income between $30,000 and $100,000 and less than $1 million in investable assets—expected to retire debt free, but today only 34 percent anticipate a debt-free retirement. Two-thirds (68 percent) are worried about another financial crisis in their lifetime.
The study also revealed that three in 10 (34%) middle-income boomers plan to rely on personal savings or earnings for their primary source of income in retirement, down from four in 10 before the crisis. This reliance appears to be shifting to Social Security, where four in 10 (38%) middle-income boomers expect to rely on Social Security for their primary source of retirement income, versus three in 10 before the crisis. This increase in reliance on Social Security is concerning, as it was designed to be a safety net and not a primary replacement for savings or income.
Concern over having enough income to last throughout their retirement has led boomers to reconsider exiting the workforce. According to the latest CSR report, before the crisis, 35 percent of middle-income boomers expected to work full-time or part-time in retirement, but today 48 percent expect to work full or part-time.
"Ten years ago, boomers had a clear vision of what a personally satisfying retirement looked like," said Scott Goldberg, president of Bankers Life. "But today, many are realizing they will not be as financially independent in retirement as they once expected."