While Americans are worried about running out of money in retirement, the percentage of people citing it as a top concern fell from 41 percent in 2016 to 30 percent in 2018, while concerns about medical costs increased. This according to the American Institute of CPAs (AICPA) Personal Financial Planning Trends Survey conducted in Q3 2018 and includes responses from 631 CPA financial planners.
The AICPA said the improvement in people’s concerns over running out of money is likely due to the economy’s steady improvement over the last few years, with the stock market continuing to climb despite volatility.
To help Americans feel more confident about their retirement readiness, members of the American Institute of CPAs’ Personal Financial Planning Executive Committee have put together these 5 tips:
- Don’t wait, explore long term care coverage early;
- Don’t look at your portfolio too often;
- Ramp up savings by taking advantage of catch-up contributions once you turn 50;
- Have a tax-efficient drawdown strategy; and
- Plan to pay off or pay down debt before retirement.
The survey also found that clients worried about maintaining their current lifestyle and spending level (28 percent) in retirement was a close second financial concern. Stress from rising health care costs (18 percent) was a distant third. However, with medical costs forecast to continue growing throughout 2019, it is not surprising that this concern is up seven percentage points from 2016.