Over three-quarters of the Baby Boomer generation whose ages are between 45 and 65 said they are willing to spend less money now to have more to invest for a more comfortable lifestyle in the future.
However, the MainStay Investments' Boomer Retirement Lifestyle study found that 40% of those surveyed believe they will have to delay their retirement in order to be able to afford the lifestyle which they desire.
Most Baby Boomers believe the following items constitute needs as opposed to luxuries: health care coverage, the Internet, the ability to shop for birthdays and special occasions and pet care needs. In addition, approximately half consider an annual vacation, eldercare/home aid, professional hair cut/color and funding their childrens' or grandchildrens' education to be basic needs as well.
Matthew Leung, director and head of practice management programs at MainStay Investments, said "An interesting pattern that we noticed throughout the research was that as consumers age, things that were once considered luxuries are more likely to be considered basic needs—thereby reaffirming that Boomers essentially want it all. In fact, almost half of consumers say they would downsize their home in retirement in order to afford these luxuries."
Almost all of the respondents declared health care as a need with three-quarters of them declaring this is their No. 1 or No. 2 greatest concern which could affect retirement lifestyle.
"While a majority of consumers are setting aside funds specifically for future healthcare costs, a whopping 41 percent are not doing anything specific to save for healthcare, and will be relying on their retirement assets to cover healthcare and everything else," said Leung. "Given their lack of allocating pre-retirement income toward these looming costs, we find Boomers' actions do not always reflect their greatest concerns."
More than half (55%) of the consumers indicated they would rather work longer to pay for healthcare expenses, rather than give up luxuries in retirement.
While the survey said Boomers are open to considering different products and strategies to help meet retirement goals, less than half are using a financial planner.
Leung added the research shows this group has an appetite for guaranteed income products.
