About a Third of Those Married/Living with a Partner Say They Agree on What They Should Save for Retirement
However, one in five married or living with a partner have not even discussed how much they should save
A recent Wall Street Journal Online/Harris Interactive Personal Finance Poll reveals that while 40 percent of adults want to use their money to continue to support their current lifestyle in their later years, about one-quarter prefer to use their money for enjoyable activities such as traveling or relocating to a warmer climate. Three out of 10 of those who are married or living with their partner are in agreement about how much they need to save for retirement, while equal numbers say they focus on saving more than their spouse/partner does (20%) or have never talked about how much they need to save for retirement (20%). The survey further explores how much retired couples say they argue over finances, how current living expenses in retirement compare with what retirees expected, and how much income those who are not retired believe they and their spouse/partner need annually in order to retire comfortably.
These are some of the results of an online survey of 2,075 U.S. adults conducted by Harris Interactive(R) between May 30 and June 1, 2006 for The Wall Street Journal Online's Personal Journal Edition.
Use of money in the later years - If adults had one choice with what to do with their money in their later years, the likelihood that they say they would continue to support the lifestyle they have now increases with age, while the likelihood that they say they would use the money to travel, buy a vacation home or relocate to a warmer climate decreases with age. - Men are more likely than women to say they would continue to support the lifestyle they have now (47% vs. 35%, respectively). - Those who are single or have never been married are substantially more likely than those who are married/living with a partner or divorced/separated/widowed to say they would use the money to travel, buy a vacation home or relocate to a warmer climate (32% vs. 24% and 20%, respectively). Saving for retirement - The level of agreement about how much they need to save for retirement rises with age and income, presumably because as couples near retirement they feel compelled to discuss their plans. - Interestingly, men are more likely to focus on saving for retirement than women (both men and women admit this is the case in their relationship). Arguing over finances
Over half (54%) of retirees who are married or living with a partner say they argue about their finances about the same amount as they used to, and 41 percent say they argue less than they did before they retired.
"Money has long been known as a source of conflict among couples. The good news is that when couples reach retirement they argue about finances much less than they did while working," states Anne Aldrich, Senior Vice President of the Financial Services Research Practice at Harris Interactive. "Moving into this stage of life takes planning and communication -- when couples take the time to work through their plans conflict can be reduced."
The notion of saving for retirement is one that is too much for some couples -- about one in 10 say that neither of them can decide on how much to save for that stage in their life.
Current living expenses vs. expectations
Over one-third (37%) of retired adults have experienced higher living expenses than they expected they would have, and this rises to nearly one out of two in the West (49%) and of those who are divorced/separated or widowed (49%) who say this.
- On average, adults who are not retired believe they and their spouse/partner need $75,233 annually in order to retire comfortably. Predictably, this number increases when responses are compared by household income.
According to Aldrich, "The outlook on spending becomes more realistic with age. Priorities shift with different life stages, and it is important for financial advisors and those in the financial services industry to be aware of their clients' needs and motivations as they near retirement so they can provide guidance that is personally relevant."
TABLE 1 MARITAL STATUS "What is your marital status?" Base: All adults Total % Married/Living with Partner (Net) 60 Married 53 Living with partner 6 Single, never married 27 Divorced 8 Separated 1 Widowed 4 TABLE 2 EMPLOYMENT STATUS "Which best describes you?" Base: All adults Those Married/ Total Living with Partner % % I am retired from my primary occupation 25 29 I am not retired 75 71 TABLE 3A USE OF MONEY IN LATER YEARS - BY AGE
"If you had only one choice, what would you do with your money in your later
years?" Base: All adults Total Age 18-34 35-44 45-54 55+ % % % % % Continue to support the lifestyle I have now 40 25 37 42 57 Use the money to travel, buy a vacation home or relocate to a warmer climate 26 34 32 25 15 Save it to pay for health care and long-term care expenses 15 17 19 15 12 Leave an inheritance for my children or grandchildren 14 16 9 14 13 Other 5 8 3 3 3 Note: Percentages may not add up to exactly 100% due to rounding. TABLE 3B USE OF MONEY IN LATER YEARS - BY GENDER AND AGE
"If you had only one choice, what would you do with your money in your later
years?" Base: All adults Male Age Total Total Males 18-34 35-44 45-54 55+ % % % % % % Continue to support the lifestyle I have now 40 47 32 47 43 62 Use the money to travel, buy a vacation home or relocate to a warmer climate 26 24 30 26 27 16 Save it to pay for health care and long-term care expenses 15 15 17 17 18 10 Leave an inheritance for my children or grandchildren 14 11 14 6 9 11 Other 5 4 7 4 3 1 Female Age Total Females 18-34 35-44 45-54 55+ % % % % % Continue to support the lifestyle I have now 35 18 28 42 51 Use the money to travel, buy a vacation home or relocate to a warmer climate 28 37 38 24 15 Save it to pay for health care and long-term care expenses 16 18 20 13 14 Leave an inheritance for my children or grandchildren 16 18 11 18 15 Other 5 9 3 3 5 Note: Percentages may not add up to exactly 100% due to rounding. TABLE 3C USE OF MONEY IN LATER YEARS - BY MARITAL STATUS
"If you had only one choice, what would you do with your money in your later
years?" Base: All adults Marital Status Total Single/ Divorced/ Married Never Separated/ Married Widowed % % % % Continue to support the lifestyle I have now 40 46 30 41 Use the money to travel, buy a vacation home or relocate to a warmer climate 26 24 32 20 Save it to pay for health care and long-term care expenses 15 12 21 17 Leave an inheritance for my children or grandchildren 14 15 9 19 Other 5 3 8 4 Note: Percentages may not add up to exactly 100% due to rounding. TABLE 4A VIEWS ON SAVING FOR RETIREMENT - BY AGE "Thinking about how you and your spouse or partner view retirement and how much you would need to save, which of the following best describes you?" Base: Adults that are married/living with partner and are not retired Total Age 18-34 35-44 45-54 55+ We are in agreement about how much % % % % % we need to save. 30 22 34 30 38 I focus on saving more than my spouse/partner does. 20 23 21 20 16 We have never talked about how much we need to save for retirement. 20 29 20 17 10 My spouse/partner focuses on saving more than I do. 11 5 10 16 14 Neither one of us can decide how much to save for retirement. 9 11 8 10 4 None of these 10 9 8 7 17 Note: Percentages may not add up to exactly 100% due to rounding. TABLE 4B VIEWS ON SAVING FOR RETIREMENT - BY GENDER "Thinking about how you and your spouse or partner view retirement and how much you would need to save, which of the following best describes you?" Base: Adults that are married/living with partner and are not retired Total Gender Male Female We are in agreement about how much we need % % % to save. 30 33 27 I focus on saving more than my spouse/partner does. 20 25 17 We have never talked about how much we need to save for retirement. 20 20 19 My spouse/partner focuses on saving more than I do. 11 8 14 Neither one of us can decide how much to save for retirement. 9 7 11 None of these 10 7 12 TABLE 4C VIEWS ON SAVING FOR RETIREMENT - BY INCOME "Thinking about how you and your spouse or partner view retirement and how much you would need to save, which of the following best describes you?" Base: Adults that are married/living with partner and are not retired Income Total Less Than $35K- $50K- $75K+ $35K $49.9K $74.9K % % % % % We are in agreement about how much we need to save. 30 12 24 26 39 I focus on saving more than my spouse/partner does. 20 15 20 22 22 We have never talked about how much we need to save for retirement. 20 32 17 26 13 My spouse/partner focuses on saving more than I do. 11 4 13 9 15 Neither one of us can decide how much to save for retirement. 9 11 17 10 6 None of these 10 27 10 6 5 Note: Percentages may not add up to 100% due to rounding. TABLE 5 AMOUNT SPOUSES ARGUE ABOUT FINANCES IN RETIREMENT "And, now that you are retired, which of the following would you say best describes you and your spouse/partner?" Base: Retired adults that are married/living with partner Total % We argue less about our finances than we used to before we retired. 41 We argue more about our finances now than we did before we retired. 4 We argue about our finances about the same amount as we used to. 54 Note: Percentages may not add up to 100% due to rounding. TABLE 6A
COMPARISON OF ACTUAL LIVING EXPENSES IN RETIREMENT AGAINST EXPECTATIONS - BY
REGION "How do your current living expenses in retirement compare with what you expected?" Base: Retired adults Total Region Northeast Midwest South West % % % % % Much/Slightly Higher (Net) 37 37 35 30 49 They are much higher than I expected. 14 11 12 7 32 They are slightly higher than I expected. 22 26 22 22 17 They are about the same as I expected. 45 42 45 51 39 Much/Slightly Lower (Net) 18 21 20 20 11 They are slightly lower than I expected. 10 13 8 12 7 They are much lower than I expected. 8 8 12 8 5 Note: Percentages may not add up to 100% due to rounding. TABLE 6B
COMPARISON OF ACTUAL LIVING EXPENSES IN RETIREMENT AGAINST EXPECTATIONS - BY
MARITAL STATUS "How do your current living expenses in retirement compare with what you expected?" Base: Retired adults Marital Status Total Single/ Div./ Married Never Sep./ Married* Wid. % % % % Much/Slightly Higher (Net) 37 33 31 49 They are much higher than I expected. 14 13 12 19 They are slightly higher than I expected. 22 19 19 30 They are about the same as I expected. 45 52 34 28 Much/Slightly Lower (Net) 18 15 35 23 They are slightly lower than I expected. 10 12 7 7 They are much lower than I expected. 8 3 28 16 *Base size is low; please use data directionally. TABLE 7A ESTIMATED INCOME NEEDED IN RETIREMENT - BY REGION
"How much income do you believe you and your spouse/partner need annually in
order to retire comfortably? If you're not sure, please make your best estimate." Base: Adults that are not retired Total Region Northeast Midwest South West % % % % % $24,999 or less 11 9 13 9 12 $25,000 to $49,999 23 18 27 28 15 $50,000 to $74,999 27 30 27 26 27 $75,000 to $99,999 17 18 12 16 22 $100,000 to $124,999 9 10 9 9 9 $125,000 to $149,999 3 2 3 1 6 Over $150,000 10 12 9 10 10 Mean $75,233 $78,026 $72,463 $71,009 $81,359 Note: Percentages may not add up to 100% due to rounding. TABLE 7B ESTIMATED INCOME NEEDED IN RETIREMENT - BY INCOME
"How much income do you believe you and your spouse/partner need annually in
order to retire comfortably? If you're not sure, please make your best estimate." Base: Adults that are not retired Income Total Less Than $35K- $50K- $35K $49.9K $74.9K $75K+ % % % % % $24,999 or less 11 35 5 2 1 $25,000 to $49,999 23 31 48 20 8 $50,000 to $74,999 27 12 24 49 31 $75,000 to $99,999 17 10 12 13 27 $100,000 to $124,999 9 4 2 7 16 $125,000 to $149,999 3 1 4 0 5 Over $150,000 10 7 5 9 12 Mean $75,233 $48,655 $59,811 $71,794 $89,268
Downloadable PDFs of The Wall Street Journal Online/Harris Interactive Personal Finance Polls are posted at http://www.harrisinteractive.com/news/newsletters_wsjfinance.asp.
Methodology
This survey was conducted online within the United States between May 30 and June 1, 2006 among 2,075 adults (aged 18 and over). Figures for age, sex, race/ethnicity, education, region and household income were weighted where necessary to bring them into line with their actual proportions in the population. Propensity score weighting was also used to adjust for respondents' propensity to be online.
All surveys are subject to several sources of error. These include: sampling error (because only a sample of a population is interviewed); measurement error due to question wording and/or question order, deliberately or unintentionally inaccurate responses, nonresponse (including refusals), interviewer effects (when live interviewers are used) and weighting.
With one exception (sampling error) the magnitude of the errors that result cannot be estimated. There is, therefore, no way to calculate a finite "margin of error" for any survey and the use of these words should be avoided.
With pure probability samples, with 100 percent response rates, it is possible to calculate the probability that the sampling error (but not other sources of error) is not greater than some number. With a pure probability sample of 2,075 adults one could say with a 95 percent probability that the overall results have a sampling error of +/- 3 percentage points. Sampling error for the various sub-samples shown in the tables is higher and varies. However that does not take other sources of error into account. This online survey is not based on a probability sample and therefore no theoretical sampling error can be calculated.
These statements conform to the principles of disclosure of the National Council on Public Polls.
About the Survey
The Wall Street Journal Online/Harris Interactive Personal Finance Poll is an exclusive poll that is published in the Personal Journal Edition of The Wall Street Journal Online at www.wsj.com/personaljournal.
About The Wall Street Journal Online
The Wall Street Journal Online at WSJ.com, published by Dow Jones & Company (NYSE: DJ; www.dowjones.com), is the largest paid subscription news site on the Web. Launched in 1996, the Online Journal continues to attract quality subscribers that are at the top of their industries, with 761,000 subscribers world-wide as of Q1, 2006.
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About the Financial Services Practice
The Harris Interactive Financial Services Practice provides custom, global research solutions to leading companies in the financial services industry. Research professionals with specific expertise across a range of financial services sectors, including banking, payment systems, securities and investments, and insurance, act as strategic partners to their clients. The Financial Services Practice plays a key role in branding initiatives, customer profiling and segmentation, new product development, customer loyalty management, market planning initiatives and studies that support clients as thought leaders. (www.harrisinteractive.com/financial)
About Harris Interactive
Harris Interactive is the 13th largest and fastest-growing market research firm in the world. The company provides research-driven insights and strategic advice to help its clients make more confident decisions which lead to measurable and enduring improvements in performance. Harris Interactive is widely known for The Harris Poll, one of the longest running, independent opinion polls and for pioneering online market research methods. The company has built what could conceivably be the world's largest panel of survey respondents, the Harris Poll Online. Harris Interactive serves clients worldwide through its United States, Europe and Asia offices, its wholly-owned subsidiary Novatris in France and through a global network of independent market research firms. The service bureau, HISB, provides its market research industry clients with mixed-mode data collection, panel development services as well as syndicated and tracking research consultation. More information about Harris Interactive may be obtained at www.harrisinteractive.com.
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