Even millionaires are feeling the pinch of inflation and becoming increasingly uncertain about the economic landscape.
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According to a new Natixis Investment Managers survey, 35% of millionaires say “it will take a miracle to achieve a secure retirement,” which is nearly as much as overall investors at 40%. One key reason may be that the million-dollar mark may not be as significant as it once was.
The survey noted that 58% of high-net-worth individuals said they accept that they will have to keep working longer than they planned, which “underscores one of the key problems of retirement planning, the unpredictability,” according to Natixis.
What’s more, 36% worry retirement may not even be an option, 42% are so worried about retirement security that they avoid thinking about it, and 38% say it will be hard to make ends meet without public benefits. Of course, a whopping 75% believe that high levels of public debt will result in lower payments from public benefits in the future, which only exacerbates to the worry.
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Additional worries include inflation, with seven out of 10 seeing it as a threat, particularly with rising healthcare costs, as 65% worry that healthcare and long-term care costs will impact their financial security in retirement.
According to Natixis, the top 10 retirement planning mistakes include underestimating the impact of inflation; underestimating how long you will live, overestimating your investment income, being too conservative in investments; setting unrealistic return expectations; forgetting to factor in healthcare costs; failing to understand income sources; relying too much on public benefits; underestimating real estate costs and being too aggressive in investments.
So how much is enough for retirement? “That truly is the million dollar question,” according to the Natixis survey.
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“In reality, the best advice for retirement planning is to save early and often so individuals give themselves as much time to save and as much time as possible for compounding to help those assets grow. After all, when it comes down to it, even millionaire investors recognize that financing retirement is no small feat.”
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