Facts & Resources

Bank of America Survey Finds Americans View Retirement Planning as Difficult as Diet and Exercise

Nearly One Quarter of Affluent Americans Find Retirement Planning Difficult

Tuesday, April 1, 2008 8:08 am EDT



Public Company Information:

"Many individuals don't know where to begin or how much they need to save. We are committed to helping make retirement planning as understandable and effortless as possible for individuals by providing straightforward tools and comprehensive guidance-based solutions."

At a time when the need for retirement planning has never been greater for individuals and families, a major roadblock exists for many Americans around starting and eventually navigating through the process, according to a national survey released today by Bank of America.

In a survey of approximately 1,000 people across the country, the Bank of America survey captured responses on an array of related topics. Among the findings: Nearly one-third (30%) of Americans say that starting retirement planning is difficult -- as many as those who say it is difficult to start a fitness routine (29%) or a diet (28%). Only one in three (33%) Americans report that they are on track with their retirement planning efforts, and nearly one quarter (23%) report that they have not started planning at all.

"Bank of America understands that retirement planning can be challenging," said Jeffrey Carney, president, Bank of America Retirement and Global Wealth & Investment Management (GWIM) Client Solutions. "Many individuals don't know where to begin or how much they need to save. We are committed to helping make retirement planning as understandable and effortless as possible for individuals by providing straightforward tools and comprehensive guidance-based solutions."

The survey, conducted by Braun Research, sampled the general public and "affluent Americans," identified as individuals with investable assets between $100,000 and $3 million. The survey confirmed that a significant number of Americans encounter challenges when planning for retirement. Respondents identified difficulty with respect to determining the types of investments they should make (42%), how much they will need to retire comfortably (40%), when to retire (33%) and where to begin (32%).

Familiarity Does Not Always Equate With Participation

The survey also uncovered that despite Americans' general familiarity with retirement products, many are still not taking full advantage of them. For example, although most Americans (79%) reported being familiar with 401(k) plans, of those with access, 22 percent do not participate. Additionally, 68 percent of Americans report being familiar with IRAs; however, only 40 percent report having one. Roth IRAs have less familiarity with one in two Americans (51%) reported being "not at all knowledgeable" with Roth IRAs. Additionally, less than half of Americans with IRAs (43%) fund them each year.

"Americans clearly need guidance and education regarding how much of their pre-tax annual income they will need to maintain a similar lifestyle in retirement," said Dan McNamara, Retirement Products Group Executive, Bank of America. "A 401(k), 403(b), pension plan, IRA or Social Security is typically not enough to enable individuals to reach their retirement goals."

Affluent Americans Struggling With Retirement Planning, Too

While affluent Americans experience fewer roadblocks to retirement planning, they share similar frustrations with the general public. Approximately one third (34%) of affluent Americans reported difficulty with identifying appropriate retirement investments, and nearly one quarter (24%) struggle with knowing how much they will need to retire comfortably. This compares to 42% and 40% respectively for the general consumer market surveyed.

Affluent Americans are familiar with retirement products in greater numbers than the general population with 84 percent reporting they are familiar with traditional IRAs, and 62 percent reporting they are familiar with Roth IRAs; however, only 56 percent currently incorporate an IRA in their retirement planning. While affluent Americans are more likely to have an IRA than the general population, they are no more likely to fund it annually. The survey revealed that only 43% of both affluent Americans and the general public with IRAs fund them annually.

The survey also revealed that most affluent Americans are addressing economic uncertainty by modifying their expenses in the short term, and maintaining their retirement investing for the long term. The survey revealed 57 percent of affluent Americans are changing their spending habits based on current market conditions. For example, nearly half (48%) are spending less on traveling and vacationing, or shopping (45%). However, nearly three quarters (73%) of affluent Americans report they have not changed the allocation of their retirement investments.

"Our survey confirms that consumer spending is tightening, contributing to the country's economic downturn," said Lynn Reaser, economist and retirement strategist, Bank of America. "The best way to protect retirement savings in volatile times is to remain diversified and maintain a long-term perspective."

The Road to Retirement Planning

Bank of America, through its affiliates Bank of America, N.A. and Banc of America Investment Services, Inc., offers a variety of tools to help customers understand and reach their retirement goals. Funding an employer sponsored savings plan, such as a 401(k) or 403(b) plan, is a great first step for retirement planning. Consumers can build upon this foundation with a traditional Individual Retirement Account (IRA), Roth IRA or Rollover IRA, which provide consumers with a vehicle to grow retirement contributions either tax-deferred or federal income tax-free depending on the account type selected. Through the power of compounding, individuals have the opportunity to generate substantial income over time with diversified IRA investments.

Individuals can learn about various IRA options on Bank of America's interactive microsite, The site provides easy-to-understand explanations of how IRAs work and the differences among IRAs. Individuals can also use Bank of America's Personal Retirement Number Calculator to see how much they will need to maintain their pre-retirement lifestyle throughout retirement and what steps they can take to help achieve their retirement goals.

Consumers can also enter one of 6,100 Bank of America, N.A. banking centers across the country, or call a Banc of America Investment Services, Inc. Financial Advisor to start or enhance their retirement planning today.

Survey Methodology

The survey was conducted by Braun Research via telephone using a random digit dial methodology between the dates of March 7-13, 2008. 750 nationally representative Americans were surveyed, with a margin of error of +/- 3.6%, plus 250 individuals with investable assets between $100,000 and $3 million with a margin of error of +/- 6.2%. The survey sample totaled 1,000 Americans.

About Bank of America

Bank of America is one of the world's largest financial institutions, serving individual consumers, small and middle market businesses and large corporations with a full range of banking, investing, asset management and other financial and risk-management products and services. The company provides unmatched convenience in the United States, serving more than 59 million consumer and small business relationships with more than 6,100 retail banking offices, nearly 19,000 ATMs and award-winning online banking with nearly 24 million active users. Bank of America is the No. 1 overall Small Business Administration (SBA) lender in the United States and the No. 1 SBA lender to minority-owned small businesses. The company serves clients in 175 countries and has relationships with 99 percent of the U.S. Fortune 500 companies and 83 percent of the Global Fortune 500. Bank of America Corporation stock (NYSE: BAC) is listed on the New York Stock Exchange.

Bank of America Corporation ("Bank of America") is a financial holding company that, through its subsidiaries and affiliated companies, provides banking and non-banking financial services. Brokerage IRAs (non-FDIC insured) are available through Banc of America Investment Services, Inc. Bank IRAs (FDIC insured) are available through Bank of America, N.A., Member FDIC.

Banking products are provided by Bank of America, N.A., member FDIC.

Investment products are provided by Banc of America Investment Services, Inc. and:

Are Not FDIC Insured May Lose Value Are Not Bank Guaranteed

Banc of America Investment Services, Inc. is a registered broker-dealer, member FINRA and SIPC, and a nonbank subsidiary of Bank of America, N.A.

"Safe Harbor" Statement under the Private Securities Litigation Reform Act of 1995: Statements in this press release regarding Bank of America Corporation's business which are not historical facts are "forward-looking statements" that involve risks and uncertainties. For a discussion of such risks and uncertainties, which could cause actual results to differ from those contained in the forward-looking statements, see "Risk Factors" in the Company's Annual Report or Form 10-K for the most recently ended fiscal year.


Robyn Tice of Bank of America, +1-617-434-7393,