America’s estimated 76 million baby boomers are still coping with the long-term effects of the 2007 financial crisis as they enter or prepare for retirement, a new study commissioned by the Bankers Life Center for a Secure Retirement.

As the financial crisis cut into their net worth and lowered the value of their homes, boomers’ confidence in achieving a personally satisfying retirement dropped significantly. 

Today, less than four in 10 (37%) boomers are certain they will have a personally satisfying retirement.

Before the crash, middle-income boomers—those defined with an annual household income between $30,000 and $100,000 and less than $1 million in investable assets—were already contending with a “new retirement” stemming from changes to their retirement programs, as employers shifted away from defined benefit plans such as pensions to defined contribution plans, primarily 401(k) plans.

The study examines how a lack of confidence has changed boomers’ attitudes and behaviors about investing and saving, and how they are adapting their expectations to meet the realities of this new retirement.

In effect, they are redefining the new retirement.

The study found 28 percent are making more conservative investments, and 26 percent report they no longer invest as a result of weathering the crisis. Further compounding their cautious behaviors, the study found two-thirds are worried about another financial crisis in their lifetime.

Additionally, the boomers surveyed say they have lowered their overall expectations for financial independence in retirement, compared to before the crisis. The study reports that only:

  • 16% expect to have savings
  • 34% expect to retire debt free
  • 19% expect to pay off their mortgage
  • 16% expect to pass an inheritance to heirs

Meanwhile, the proportion of boomers who expect to work full or part-time in retirement has increased from just over a third to nearly one-half since before the crisis.

This study, “10 Years After the Crisis: Middle-Income Boomers Rebounding But Not Recovered,” is part of a series of studies commissioned by the Bankers Life Center for a Secure Retirement. It was conducted in October 2016 by independent research firm The Blackstone Group.

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