OREANDA-NEWS. June 11, 2015. Nearly seven in 10 (69 percent) San Francisco residents expect to be financially stressed in retirement based on how they are currently saving, according to a new survey released today by Bank of America and Merrill Edge. The latest Merrill Edge® Report reveals that while San Francisco non-retirees are anticipating stress, the majority (62 percent) of local retirees in the area are not stressed about finances based on how they saved.

Despite predicting stress, more than half (52 percent) of non-retired San Francisco respondents believe they will have enough money in retirement due to how they are saving for it, while the vast majority of retired respondents (78 percent) report they will have enough money for the rest of retirement based upon how they saved for it before they retired.

Part of a biannual nationwide survey, the study explores the opinions of San Francisco residents with investable assets of \\$50,000 to \\$250,000 and finds that area respondents are slightly more likely to prioritize having enough money to live comfortably today (64 percent) over saving money for the future (59 percent).

“The San Francisco market is caught between concern for the future and wanting to enjoy their lives now,” said Linda Shelby, regional executive at Merrill Edge. “The good news is despite their stress surrounding their retirement years, they are taking proactive steps to pursue future financial success.”

Pursuing an ideal retirement without financial stress

Nationally, the Merrill Edge Report finds most non-retired respondents agree that an ideal retirement is one that is not spent worrying about money (77 percent) and is overall stress-free (70 percent). San Francisco respondents who have yet to reach retirement are taking action to get there like today’s retirees, but could do more to emulate strategies that retired Americans employed to ensure that their golden years were less worrisome:

  • Today, the most popular actions that non-retired San Francisco residents are taking to live a stress-free retirement are funding retirement accounts (60 percent), such as a 401(k) account or an IRA, and paying off debt (56 percent). Contributing to a retirement account (51 percent) and paying off debt (60 percent) were also some of the most common measures that retirees took to reduce strain in retirement before reaching that stage.
  • However, nearly six in 10 (57 percent) of area retirees preemptively worked with a financial advisor to be stress-free when they did retire, and only 29 percent of non-retired area respondents are doing this with the same goal in mind.
  • Similarly, only 37 percent of San Francisco respondents who have yet to reach retirement are investing in non-retirement accounts to reduce stress; whereas, more than four in 10 (43 percent) area retirees proactively invested as much as they could prior to retirement.

Financial fears lead to positive financial actions

According to the survey, while the majority of non-retired San Francisco residents are actively investing for retirement, nearly one-third (31 percent) would still be embarrassed if their close friends or family knew intimate details of their finances, including their retirement savings (14 percent), checking account balance (13 percent) and credit score (13 percent).

Along similar lines, 37 percent of national respondents feel that they lag behind their peers in terms of financial stability, saving for the future or current income. However, these shortfalls also appear to be a catalyst for better financial planning. Area retirees and non-retirees alike have felt motivated to make positive financial decisions by financial stress (20 percent) and by seeing the failures and successes of their parents (25 percent).