Baby Boomers Reveal Biggest Retirement Fears

Money and health worries keep baby boomers and seniors awake at night.

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Many baby boomers are dreaming about a retirement filled with traveling, taking up hobbies, or simply spending more time with family and friends. But they also fear that this dream will be disrupted by financial and health problems. AARP recently asked Americans age 50 and older to describe their biggest retirement worries. Here are the top reasons thinking about retirement keeps many baby boomers and seniors awake at night.

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Health care. Staying healthy and mentally sharp were nearly universal retirement goals among those surveyed. But health care issues including the cost of care and the ability to stay healthy were also most often listed as the top retirement challenge, according to the AARP survey of 1,000 adults age 50 and older. Only about a third (35 percent) of individuals over 50 say they currently have adequate health insurance coverage. And even once you qualify for Medicare at age 65, you will still have to pay for premiums, deductibles, copays, and coinsurance unless you buy a supplemental policy. Estimates of how much a 65-year-old couple will need to pay for out-of-pocket health care costs throughout retirement range from $197,000 (Center for Retirement Research at Boston College) to $250,000 (Fidelity Investments) to $271,000 (Employee Benefit Research Institute), and could vary significantly based on how much medication or treatment you require. And many common necessities such as eyeglasses and hearing aids are not covered by Medicare. In an effort to combat rising health care prices, several new services have been added to Medicare in 2011 including a free annual wellness visit, preventative care screenings with no cost sharing, and prescription drug discounts within the Medicare Part D coverage gap.

[Visit the U.S. News Retirement site for more planning ideas and advice.]

Running out of money. Financial concerns are second only to health care. Americans over 50 are concerned about their ability to save enough for the future (59 percent) and managing their workplace retirement accounts (38 percent). Even more people are worried about spending down their wealth efficiently and maintaining their current lifestyle throughout retirement (62 percent). Rising utility costs including heating, cooling, electricity, and water are also a major concern for those on a fixed income (53 percent). It doesn’t help that almost half (46 percent) of those surveyed are still managing debt. Many seniors plan to cope by frugally managing their nest eggs. Some 60 percent think it’s important to seek out the best deals and discounts to help maintain their life savings for as long as possible. Many older Americans (81 percent) are also making it a priority to protect themselves from consumer fraud, including identify theft (72 percent) and deceptive business practices (64 percent).

[See 10 Reasons You Won’t be Able to Retire at 65.]

Maintaining independence. Remaining self-sufficient is a major retirement goal for most baby boomers. But they also worry that they might eventually need help. Many Americans over 50 (41 percent) are focused on staying in their own residence as long as possible. However, almost as many seniors (39 percent) are exploring alternative housing options that require less personal upkeep or offer extra services and 94 percent say it’s important to live in a place with long-term care services that allow aging in place. Some seniors (29 percent) are also concerned about their ability to continue driving as their health or vision deteriorates. In addition to providing for their own needs, some baby boomers need to provide care to aging parents, other relatives, or a spouse. Over half (52 percent) of those surveyed are worried about their ability to provide financial support for family members, while also supporting themselves.

Twitter: @aiming2retire