AAII Survey: Most Investors Believe Future Retirees Will Be Worse Off Than Those Already Retired

The goal of every generation should be to leave the world in better shape than they found it and to be better off than previous generations. That was the case for generations up until the Baby Boomers. Since then, uncertainty has crept into the equation. Ask today’s millennials and Gen-Z’ers and they are far less optimistic about their futures. With Social Security under increasing pressure as Baby Boomers enter retirement and memories of the Great Recession still fresh in the minds of many investors, achieving a comfortable retirement seems out of reach for many future retirees.

AAII Weekly Survey Question

While our readers tend to skew older, we are curious to hear their views on the prospects for future retirees. So last week we asked:

Do you think future generations of retirees will be worse off than those currently in retirement?

Here are the results:

In all, 2,191 readers participated.

The majority—67%—feel that future generations will be worse off than those currently in retirement. Only 8% of those participating believe that future retirees will be better off than those currently in retirement. Another 20% feel that future retirees will have it about the same as current retirees and 5% are unsure of what the future holds.

Weekly Special Question

As humans, we all have regrets. We have all probably pondered decisions that we wish we had handled differently. As they say, hindsight is 20-20. That being said, when it comes to investing, we all probably wish we had done something differently over the years.

With this in mind, last week’s special survey question asked:

If you could offer your 21-year-old self one piece of advice when it comes to retirement planning, what would it be?

In all, 627 readers participated.

Generally speaking, the responses fell into four broad categories:

  • Start early (29%)
  • You can only depend on yourself (28%)
  • Invest for the long term (24%)
  • Create a plan and stick to it (19%)

The most popular single response, by nearly a three-to-one margin, was to save/invest as much as possible. When I was first starting out, I was told more than once “save until it hurts and then save a little more.”

From there, the responses were evenly distributed among several topics, including:

  • Invest in a Roth account
  • Invest in mutual funds/ETFs
  • Make regular contributions to your investment account
  • Participate in company retirement, pension plan

Here is a sampling of the responses readers would have told their 21-year-old-selves when it comes to retirement planning:

  • “Put all you can possibly afford into a Roth IRA or Roth 401(k).”
  • “Have the discipline to make sacrifices with regard to discretionary spending to adequately fund your retirement savings.”
  • “Live within your means so you can save at least a little.”
  • “There is no such thing as “too much in the retirement account” while you are still contributing.”
  • “Save a regular amount.”
  • “Start investing ASAP!”
  • “Drive to Omaha and buy 200 shares of Berkshire Hathaway.”
  • “You don’t need to take excessive risks to amass a retirement nest egg if you start early and contribute regularly.”
  • “Get a lifetime subscription to AAII!”
  • “Invest in stocks.”
  • “If your employer offers a 401(k) plan take advantage of it as soon as you possibly can and increase it to the max allowed as your finances allow. If your company does not have a 401(k), then start a Roth as soon as you can.”

Everybody has an opinion! Why not give us yours? Participate in our weekly member poll, updated every Monday, and see the results online at www.aaii.com/memberquestion.