Factors Affecting Confidence in a Financially Secure Retirement

The need to prepare financially for retirement is clear as individuals live longer and increasingly take early retirement. In 1900, life expectancy at birth was 47 years; in 1993, it was 76 years. For those who reach age 65, average life expectancy of men is expected to rise from a current 81 years to 85 in 2040; for women, it's 85 and 88 ("The economics of aging, " 1994). Average age of retirement declined throughout the 1980s and is now 62. One-third of all household heads currently leave their primary job before age 55 and one-half retire before reaching 60 (Ruhm, 1989). Those without pensions or sizable personal assets are likely to remain in the labor force longer than those with more resources (Bennett, 1994). According to 1986 figures, incomes of persons 65 and over consisted of: (a) Social Security benefits, 38%; (b) pensions, 16%; (c) miscellaneous, 3%; (d) employment, 17%; and (e) private savings, 26% (Shilling, 1994). When baby boomers retire, government programs wil