Americans See Themselves as Retirement ``Survivors''; Allstate Survey Shows They Know the Financial Obstacles They Face.

NORTHBROOK, Ill. -- When it comes to preparing for retirement, Americans see themselves as survivors - they believe they'll ultimately overcome challenges and learn to live with the tradeoffs to win their financial battle.

In fact, when the fourth annual Allstate "Retirement Reality Check" survey asked Americans to compare their retirement preparedness to a reality TV show, "Survivor" was the hands-down choice. Regardless of age, gender, education, income or geography, survey respondents said they identify with the description: "It's going to be a challenge, but disciplined budgeting will lead to a great retirement."

Allstate's "Retirement Reality Check" survey is an annual review of Americans' attitudes toward, and savings for, retirement. The 2004 survey shows that, while Americans generally are optimistic about retirement, they recognize specific areas in which they are falling short financially.

"This year's survey results show that Americans have tempered their long-term optimism about retirement with a good dose of realism," said Casey Sylla, president, Allstate Financial. "I'm pleased to see that people recognize that some serious work lies ahead in order to ensure a comfortable retirement -- and this is a good first step towards creating a successful plan for retirement."

The Allstate survey revealed that few people relate to "Joe Millionaire," with only 14 percent of survey respondents agreeing, "I am financially secure and have no worries about retirement." On the other hand, only 13 percent saw themselves as "The Apprentice," described as "I believe I will have to work during retirement to maintain my lifestyle."

Six percent responded that they are in need of an "Extreme Makeover" because "my retirement preparations need a complete overhaul," and only five percent identified with "Fear Factor," meaning "I am so unprepared for retirement the thought terrifies me."

OVERALL SURVEY LEARNINGS

Americans look forward to retirement, with 18 percent strongly agreeing and 35 percent of survey respondents somewhat agreeing that those will be the best years of their lives.

The 2004 "Retirement Reality Check" showed that Americans see retirement as a time to do what they want (83 percent), spend more time with family (78 percent) and have less stress (69 percent). And most of those surveyed say they are very (20 percent) or somewhat (56 percent) financially prepared for retirement.

This overall optimism crosses gender, generation and geographic lines and comfort level generally increases with education level and household income.

Even though half of the survey respondents say they've had to beef up retirement savings in recent years to catch up to where they think they should be, they still don't expect to postpone retirement. In fact, according to the survey, most Americans don't expect to work past age 65, although a majority think they'll work for pay at some point after they retire.

HEALTH CARE LEADS CONCERNS

Health care costs are a major worry for Americans surveyed. For example, 63 percent of survey respondents said they are concerned about the ability to afford health care after retirement. Among respondents, 68 percent of Gen-Xers, 64 percent of Boomers, and 55 percent of the Silent Generation shared that concern.

Other things that survey respondents said they want to protect financially included the ability to pay bills in case of disability (81 percent), pay for children's education (77 percent), repair the home if it's severely damaged (83 percent), repair or replace cars in case of accident (62 percent), and maintain the family's lifestyle in case of death (62 percent).

Other issues of major importance to more than half of survey respondents included the ability to have more than one car (27 percent), take vacations (17 percent), and afford hobbies (14 percent).

Less important to respondents in the survey were the ability to give generous gifts (8 percent) and pay for regular entertainment (7 percent).

"Fortunately insurance is available to help people protect what they have today and prepare for the future," Sylla said. "Reviewing insurance coverage should be part of everybody's ongoing financial review. It can also help someone determine if they need to make minor sacrifices, if necessary, in order to ensure their retirement goals are met."

RESPONDENTS IDENTIFY PLANNING SHORTFALLS

But when asked about specifics, the Allstate "Retirement Reality Check" survey shows that Americans know they are falling short in their ability to protect financially the things most important to them. On the other hand, survey respondents admitted they're not always able to protect what they most value. For example, only 41 percent of respondents said they are very confident they can afford quality health care in case of a major illness, and only 32 percent said they're confident of paying for uninsured medical costs. Overall, only 47 percent of survey respondents said that if they were to pass away, their family's lifestyle would be protected.

Respondents were more confident about their financial ability to protect their homes in case of damage (60 percent), replace cars in case of an accident (57 percent), and pay for regular entertainment (50 percent).

"While those who participated in the survey seemed confident they'll survive whatever their retirement might bring, they do not feel adequately prepared to pay for expenses that might occur," noted Mathew Greenwald, Ph.D., president of Mathew Greenwald & Associates, the firm that conducted the "Retirement Reality Check" survey. "There are things that individuals can do now - reviewing their protection and savings vehicles and identifying gaps - to help subside some of the apprehension around covering unexpected costs during their retirement."

Working Americans may want to take some cues from retirees. The "Retirement Reality Check" survey asked current retirees what steps they would have taken when preparing for retirement based on what they know now. They cited:

--Educate myself on different savings options available (32 percent);

--Decide which savings vehicles would help save the most for retirement (28 percent);

--Determine whether I had prepared for life's unexpected events (23 percent); and

--Monitored savings and investments to make sure they were the most appropriate investment choices given the time left before retirement (24 percent).

Fear of outliving retirement savings is about equal among retirees (15 percent) and non-retirees (14 percent). However, that fear varies significantly depending on where the respondent lives. Overall, for example, 23 percent of respondents who live in the Northeast strongly agree they fear outliving their savings, compared with 14 percent of respondents who live in the South and 12 percent who live in the Midwest and West.

Allstate created the fourth annual Allstate "Retirement Reality Check" survey in conjunction with Mathew Greenwald & Associates. Using a random digit dialing methodology, Greenwald & Associates polled 1,604 people born between 1946 and 1978, with household incomes of $35,000 or more. Retirees were accepted with incomes of at least $20,000. The margin of error (at the 95 percent confidence level) for the total number of respondents in this study is +/-2.5 percent, +/-3.8 percent for information specific to Gen Xers, +/-4.5 percent for Baby Boomers, and +/-5.0 for Silent Generation.

The Allstate Corporation (NYSE:ALL) is the nation's largest publicly held personal lines insurer. Widely known through the "You're In Good Hands With Allstate(R)" slogan, Allstate helps individuals in more than 16 million households protect what they have today and better prepare for tomorrow through more than 12,900 exclusive agencies and financial specialists in the U.S. and Canada. Customers can access Allstate products and services through Allstate agencies, or in select states at allstate.com and 1-800 Allstate(R). Encompass(SM) and Deerbrook(R) Insurance brand property and casualty products are sold exclusively through independent agents. Allstate Financial Group provides life insurance, annuity, retirement, banking and investment products through distribution channels that include Allstate agencies, independent agencies, worksite, financial institutions and broker-dealers.