An astounding 9 percent of Washington adults expect lottery winnings to help fund their retirements.
A recent AARP survey of Washington workers turned up the unsurprising results — most people expect to retire, and most are not saving enough to ensure they will have enough money to do so at their present standard of living.
Winning the lottery is a popular retirement strategy. So too are starting a business late in life, inheriting money and making smart investments.
“You’re not going to win the lottery,” said Doug Shadel, AARP’s Washington state director and contributor to the report, “Ready or Not? Retirement Readiness Among Washington State Adults Ages 18-64 in the Workforce.”
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The survey of 1,000 adults had a margin of error of 3.2 percent.
AARP and a host of retirement groups offer planning tools for workers of all ages. But year after year, the story is the same — most people either lack the will to save or access to a retirement plan to make it a reality.
Shadel, who visited the Tri-Cities on Oct. 26 to share retirement planning tools with local residents, said it’s human nature to put off thinking about retirement until it’s close at hand.
He cites a Stanford University study that used virtual reality to evaluate how college-aged adults viewed saving for retirement.
In the 2009 experiment, students explored a virtual home. Those in the control group saw their 20-something faces reflected back at them in the virtual mirrors. Students in the experimental group saw an “oldified” version of themselves, aged to their late 50s.
After the virtual tour, they were asked to allocate hypothetical money. The “oldified” students allocated almost two and a half times more money to retirement than their peers.
“If you can help people visualize their future self, they save more,” Shadel said.
Working Washington adults have a sense they’re not doing enough, according to the AARP survey. More than half of the respondents admitted they’re anxious about their future finances. The anxiety levels cut across all age groups.
But in one of the survey’s biggest disconnects, 77 percent reported being somewhat confident they will retire some day, while 45 percent had saved less than $25,000 toward retirement and a quarter have less than $5,000 set aside.
Shadel said he was startled by another finding — two out of three of those surveyed had never computed what it will cost to retire. AARP offers free calculators on its website, aarp.org, as do any number of banks and financial planners.
“If you don’t know where you’re going, any road will take you there,” he joked.
A quarter of Washington workers aren’t eligible for employer-sponsored savings. The rate is slightly higher for younger workers, 29 percent.
Lack of access will change in 2017 with the launch of the Washington state Small Business Retirement Marketplace, which will enable companies with fewer than 100 employees to offer low-cost plans to their employees on a voluntary basis.
According to the AARP survey, 77 percent of workers without retirement plans would sign up if given a chance.