SMI on the Radio: Learning From Retirees About Preparing for Retirement (audio & transcript)

May 22, 2024
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"Ask the man who owns one." That was the advertising slogan of an American car company years ago. The idea was that if you want advice, talk to someone who has first-hand experience.

That same concept is part of the long-running Retirement Confidence Survey from the Employee Benefit Research Institute. It gathers data not only from today's workers but also from current retirees. After all, retirees have first-hand experience regarding retirement finances.

SMI's managing editor Matt Bell discussed the latest survey results yesterday on Faith & Finance on American Family Radio.

Click the play button below to listen. Scroll down for the transcript.

Faith & Finance with host Rob West airs each weekday morning on American Family Radio. A different version airs weekday afternoons on Moody Radio.

(More radio appearances by members of the SMI team are posted on our Resources page.)


Rob West:
Are you confident you'll be able to retire comfortably someday? Are you taking steps to make that happen?

Hi! I'm Rob West. Inadequate savings, faulty assumptions, and high inflation could create barriers to a comfortable retirement. Can we learn anything from today's retirees? Matt Bell thinks we can and he joins us to talk about it. Then it's on to your calls at 800-525-7000.

This is Faith & Finance on American Family Radio — biblical wisdom for your financial journey. (them music ends)

Well, it's always a treat to have Matt Bell on the program. Matt's the managing editor at Sound Mind Investing, an underwriter of this program. And Matt, great to have you back.

Matt Bell:
Rob, it's always great to be with you.

Rob West:
Matt, the Employee Benefit Research Institute does the Retirement Confidence Survey every year, and I'd love for you to share with us what the latest data shows about how people are feeling about their retirement prospects.

Matt Bell:
Sure. Yeah. Fairly high levels of confidence is kinda the bottom line in the latest report.

Nearly 70% of people in the workforce today — and a little bit higher numbers of those who are now retired — say they feel at least "somewhat confident" they'll have enough money to live comfortably throughout their retirement.

Now, not surprisingly, Rob, one of the top retirement related concerns to come out of that survey — among both groups — centers on inflation. Today's workers say higher prices are simply making it tougher to save for their later years.

And another concern, from both groups, is the possibility that the government may make changes to the American retirement system.

Rob West:
Well, I don't think it's a bad thing to be concerned about those things because it inspires folks to prepare for whatever might happen in retirement — although I don't think it'll be easy for lawmakers to make wholesale changes to retirement laws and regulations.

Nevertheless, what lessons can workers learn from this survey?

Matt Bell:
What stands out to me, Rob, are several areas of disconnect — either between worker optimism and their actual preparedness or between worker expectations and the actual experiences of today's retirees.

So for example, while high numbers of people in the workforce are confident about how well their finances will hold up in retirement, a large number of today's oldest workers — 43% of those aged 55 or older — have less than $100,000 saved for retirement.

Rob West:
That's something many people could probably do something about.

Matt Bell:
Yeah, that's right, Rob. I mean, well, we can't control how the stock market performs. A lot of us do have some control over how much we're setting aside for retirement.

Another area of disconnect, Rob, has to do with the fact that a lot of today's workers say they intend to work past the traditional retirement age of 65 — and yet just 19% of today's retirees actually retired that late.

So, I think it's important for all of us who are working today to see that many of today's retirees stepped out of the workforce earlier than they had intended to. And while some did so simply because they could afford to, most in that situation had to retire because of health issues or changes at their workplace.

And one related note, Rob, large numbers of today's workers — 75% in fact — are counting on being able to work for pay to some degree in retirement, whereas only 30% of today's retirees actually have.

Rob West:
Now, Matt, you mentioned the date they plan to retire. I know one of the disconnects in marriage is often spouses don't know when their spouse plans to retire.

We've actually seen some studies on this, haven't we?

Matt Bell:
Yeah, that's right. And that's kind of surprising. It really shows the lack of communication about, really I think, a lot of financial topics.

But it's interesting and it's noteworthy that, like you said, high numbers of married couples report that they're not sure when their spouse intends to retire. So, can you imagine seeing your spouse head out the door in the morning someday with the golf clubs instead of the briefcase, and that's your first hint that they've retired?

Rob West:
(chuckle) Definitely a breakdown in communication there. So, make this one of the notes along the way here from today's broadcast that you need to have that conversation if you haven't already.

Now, Matt, what are the takeaways from these two areas of disconnect that you highlighted a moment ago — [confident yet not having much money saved, and planning to work later in life even though things rarely pan out that way]?

Matt Bell:
Well, I think they both have to do with setting realistic expectations. I mean, you don't want to create a retirement plan that's based on an absolute best-case scenario. For example, a plan based on having to work until you're age 70 or having to be able to generate some work-related income in retirement.

The ideal would be to build a plan where those things will be helpful if they work out, but they're not absolutely necessary.

Rob West:
Anything else that stood out to you from this study we need to know about?

Matt Bell:
One other thing that stood out to me is the benefit of running the numbers on retirement. That means using a retirement calculator to estimate how much money you'll need in retirement and how much that means you should be investing right now to give yourself the best chance of achieving that goal.

Surprisingly, from the survey, only half of today's workers have taken that step. But those who have run the numbers — it really shows the benefits — they tend to begin saving more.

And that just makes sense — I mean, the more real we can make retirement, the more we can see what we need to do in order to retire successfully, the more likely we are to take those steps that we need to take.

Rob West:
There's no doubt about that.

Now, Social Security is, of course, a big concern for retirees. So, what should future retirees know about this area?

Matt Bell:
Well, for starters, it would be helpful to find out how much you're likely to receive in benefits. The Social Security income that people will receive, the benefits they'll receive — that'll be an important source of income in retirement for most of today's workers.

However, back to the survey, fewer than half know what their benefits will amount to at their planned retirement age, and less than 60% — according to the survey — have thought about how the age at which they claim benefits will impact the amount they receive.

Now, all this information is readily available at the Social Security Administration's website, which is, or by looking at your Social Security statements.

Rob West:
Of course, one of the biggest hindrances to a comfortable retirement is debt. So, let's talk about that area and perhaps anything the survey revealed.

Matt Bell:
Sure. For some reason, this year's survey apparently didn't even ask about debt. However, last year's survey did, and during that survey, nearly two-thirds of workers acknowledged that debt is a problem for them. And that issue is not likely to have disappeared between that survey and this survey. So we can assume it's still present for a lot of people.

Now, while last year's survey didn't break down debt into specific types, other surveys I've seen point to an increase in the number of people bringing a mortgage into their later years and how that can really hinder their financial freedom.

So, Rob, as we've recommended before, it's wise to plan to retire your mortgage by the time you retire, and if rates ever go down again and you decide to refinance, be careful not to reset the payoff clock to a date that's passed your intended retirement age.

Rob West:
That's great advice. And that may lead some retirees to extend their years of work so they can sync up that retirement date with their payoff, right?

Matt Bell:
Yeah, that's right. The mortgage is typically people's biggest expense. And so, wow, if you can get that taken care of by the time you retire, that just gives so much more freedom and flexibility in your retired years.

Rob West:
That also takes us back to what you talked about a moment ago, and that is Social Security. We tend to recommend that folks who don't need the Social Security money right now, especially if they're continuing to work, that they delay taking Social Security to get those guaranteed increases.

Would you agree with that?

Matt Bell:
Yeah, absolutely. And one other benefit of doing that is that if a man is perhaps earning more in his lifetime than his wife is and he's got the bigger Social Security benefit, typically men pass away earlier than women do, and so she would be able to move into his benefit.

And so it benefits her if he delays his benefits as long as possible so that she'll be able to make use of that larger benefit.

Rob West:
That's great advice. Let's stay with that for a moment. You mentioned that we men will — just based on the averages — pass away before our wives. What's important for this season of life to think about Matt, so that a spouse, perhaps a wife who was not as involved in the finances, is prepared to take over that responsibility?

Matt Bell:
And that's typically the case. I mean, it's not the case in every household, but it often is the case that the man is making some of the financial decisions — maybe has those relationships with a financial advisor, with a lawyer, with an accountant. So one really, really beneficial, really helpful step would be to make sure while you're both alive, that you both have a relationship with these various financial professionals.

And I mean things like beneficiary designations and having a will in place or a trust if that's appropriate for you. All of these things that we feel like are "back burner" sorts of things, we'll get to them someday one day. But I'll tell you, it truly is as boring as some of these documents can be, it's really an act of love to have all these things in place so that things are just easier for those you leave behind.

Rob West:
Matt, let's finish today with a biblical worldview of retirement. As believers, we don't subscribe to the same approach to retirement that the world does — that there's some sort of expiration date on our calling, that at 65 we just automatically move to a life of leisure. That's not the biblical model.

So what, then, is a biblical approach to retirement?

Matt Bell:
Yeah, it's an interesting tension that I think Christians, that we as Christians, live with. So the culture defines retirement, paints it in a certain picture, that really we don't find any evidence for that picture in scripture. So our whole lives are intended to be lives of service and contribution.

However, the fact is most of us will one day retire from a paid job — whether for health issues, the health issues of a loved one, a change at work, or God redirecting our efforts toward more volunteer work. For one reason or another, most of us, the statistics tell us will, in fact, one day retire from paid work.

So it's important spiritually, it's important vocationally, it's important emotionally to plan, to continue to work as long as we possibly can. But it's important financially to plan to retire perhaps earlier than we thought we might.

Rob West:
I love what Ron Blue says. He says we should think about "retiring to something and not from something" — and really talking not only to our spouse but to the Lord about what that season of life should look like.

Matt, do you think it's possible that we could even overaccumulate and miss out on an opportunity to do some more significant giving during our working years?

Matt Bell:
I do think so. I think too often we succumb to fear. We read headlines about how people are just not well prepared for their later years, and so we just assume that we need to be accumulating more and more and more.

And so there too, it's kind of a tension we live with. We want to be wise, we want to provide for our family's needs, so we want to make sure that we're thinking and being very intentional about setting aside enough resources to provide for our families long term, but we don't want to live in fear, especially if that makes us oversave or underinvest in God's kingdom work while we're still alive.

Because I think in part, we miss out on the joy that way. What a joy it is that while we're still living, we can see and we can participate in the contribution to God's kingdom work.

Rob West:
Such important lessons to learn about retirement. Matt, thanks for stopping by and sharing this with us today.

Matt Bell:
My pleasure, Rob.

Rob West:
All right. That's Matt Bell, managing editor at Sound Mind Investing. You can read a lot more in this helpful article. It's titled Helpful Lessons from Today's Retirees. You'll find it right there on the homepage. It's Just look for Helpful Lessons from Today's Retirees.

We'll be right back. Stick around.

Written by

Joseph Slife

Joseph Slife

Joseph Slife has been a news writer for the Associated Press, a college instructor, and a radio host. He and his wife Joye have three grown sons.

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