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Eager to Remain Independent in Retirement, Phoenix Residents Look to Overcome Financial Obstacles in 2016

Merrill Edge® Report Finds Many Dealing With Economic Pressures and Debt on the Road to a Better Retirement

Monday, November 2, 2015 9:00 am EST

Dateline:

PHOENIX

Public Company Information:

NYSE:
BAC
"I am very pleased to see a long-term financial focus in Phoenix, prioritizing saving and investing in anticipation of a lifestyle upgrade in retirement"

The majority of Phoenix residents believe they will be spending less (70 percent), saving more (69 percent) and investing more (54 percent) in 2016, according to a new survey released today by Bank of America and Merrill Edge.

The latest Merrill Edge® Report reveals that these forward-looking financial behaviors may be in anticipation of a desired lifestyle upgrade during their retirement years. The national survey found the majority of respondents plan to improve their standard of living in retirement, versus using their budget only for the necessities. Phoenix area residents appear to share the same sentiments:

  • Today, the majority (51 percent) of area residents say they would not be willing to move in with friends or family during retirement to minimize expenses.
  • Nearly one-third (29 percent) of Phoenix respondents are not willing to move to a cheaper area during their retirement years.
  • More than one in five (21 percent) local residents would not be willing to move to a smaller home in retirement.

“I am very pleased to see a long-term financial focus in Phoenix, prioritizing saving and investing in anticipation of a lifestyle upgrade in retirement,” said Christine Baim, regional sales executive at Merrill Edge. “But it’s important that area residents aren’t just saving to save. To feel financially confident in retirement, it’s integral to have a plan going in, setting financial goals and having an understanding of the budget needed to maintain the desired lifestyle, so you have something tangible and realistic to work toward.”

The biannual survey of 1,000 Americans with investable assets of $50,000 to $250,000 found that despite an optimistic outlook for 2016 and their retirement years, many are still impacted by external economic pressures and justifiable debt today, potentially keeping them from achieving their financial goals.

Many (40 percent) respondents view the current economy as the factor most likely to impact their saving habits, compared to their spending or investment behaviors. And despite planning to spend less in the upcoming year, Phoenix residents still think some specific expenses are worth taking on debt:

  • More than half report that they have gone into debt for a home (54 percent) or for a car (54 percent).
  • Compared to the national level, more Phoenix residents have invested in education and taken on student debt for themselves (28 percent compared to 16 percent nationally).
  • Twenty-seven percent of Phoenix residents report they have gone into debt for home improvements or renovations.

In looking back on their splurges, most Phoenix residents still remain confident in the majority of their debt-inducing expenses. Out of the 54 percent of Phoenix locals who went into debt for a house, 91 percent affirm that it was worth going into debt, perhaps viewing their debt as a long-term investment. Additionally, of those the 54 percent who went into debt for a car, 67 percent still believed it was “worth it.”

For more in-depth information about the financial behaviors and priorities of mass affluent Americans, read the entire Merrill Edge Report Fall 2015 or take our poll here. A complementing infographic is available here.

Merrill Edge Survey Methodology
Braun Research, Inc. conducted a nationally representative telephone survey on behalf of Merrill Edge. The survey was conducted from September 8 through September 20, 2015, and consisted of 1,001 mass affluent respondents throughout the U.S., defined as individuals with investable assets (value of all cash, savings, mutual funds, CDs, IRAs, stock, bonds and all other types of investments excluding primary home and other real estate investments). Respondents in the study were defined as aged 18 to 34 (millennials) with investable assets between $50,000 and $250,000 or those aged 18 to 34 who have investable assets between $20,000 and $50,000 with an annual income of at least $50,000; or aged 35-plus with investable assets between $50,000 and $250,000. We conducted an oversampling of 300 mass affluents in the following markets: San Francisco; Los Angeles; Orange County, California; Dallas; New Jersey; South Florida; Chicago; and Phoenix. The markets of Chicago and Phoenix were newly surveyed this wave. The margin of error is +/- 3.0 percent for the national sample and about +/- 5.7 percent for the oversample markets, all reported at a 95 percent confidence level.

Merrill Edge
Merrill Edge is a streamlined investment service that provides access to the investment insights of Merrill Lynch and the convenience of Bank of America banking. With Merrill Edge, clients can view their Merrill Edge investment and Bank of America bank accounts on one page online. They also have access to easy-to-use tools, actionable insights, one-on-one guidance and competitive pricing for online trades. If clients prefer to receive advice and guidance to pursue and track financial goals, Merrill Edge Roadmap® allows them to work one-on-one with a Merrill Edge Financial Solutions Advisor to develop a personalized action plan and receive specific investment recommendations tailored to them and their personal goals.

Bank of America
Bank of America is one of the world's leading 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 approximately 47 million consumer and small business relationships with approximately 4,700 retail financial centers, approximately 16,100 ATMs, and award-winning online banking with 32 million active users and more than 18 million mobile users. Bank of America is among the world's leading wealth management companies and is a global leader in corporate and investment banking and trading across a broad range of asset classes, serving corporations, governments, institutions and individuals around the world. Bank of America offers industry-leading support to approximately 3 million small business owners through a suite of innovative, easy-to-use online products and services. The company serves clients through operations in all 50 states, the District of Columbia, the U.S. Virgin Islands, Puerto Rico and more than 35 countries. Bank of America Corporation stock (NYSE: BAC) is listed on the New York Stock Exchange.

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