MSP’s Retirement-Ready Rank Slides From #1 to #18
People in the Minneapolis-St. Paul metro area seem to be significantly less prepared for retirement this year than they were a year ago, according to data released Tuesday by Ameriprise Financial.
The Twin Cities slid from the top spot last year to 18th on the “New Retirement Mindscape 2011 City Pulse Index”-which ranks the country's 30-largest metropolitan areas based on residents' preparedness for retirement.
According to the study, rapidly declining home prices, tornados, and the Minnesota government shutdown-all of which local residents faced within the past year-likely contributed to the metro area's slide through the ranks.
The study's findings are based on survey responses from more than 11,000 people between the ages of 40 and 75. Each of the 30 metro areas was scored based on whether residents have determined the amount of money they need to save for retirement and their actual saving habits. The study also took into account whether residents have planned for activities during retirement and whether they express confidence about achieving their retirement goals.
Fifty-one percent of respondents from the Twin Cities reported that they have money set aside in retirement accounts and investments-down from 83 percent last year. Only 23 percent-compared to 36 percent last year-said they have determined the amount of income they will need for retirement.
The study found that people across the country are skeptical about their retirement prospects. While 75 percent of respondents said they've taken steps to prepare financially for retirement, only 18 percent of those surveyed said they believe they'll achieve their retirement goals.
“A bit of pessimism is understandable considering that the financial markets have been highly volatile, unemployment remains high, and many have seen the value of their homes continue to decline,” Suzanna de Baca, vice president of wealth strategies at Ameriprise Financial, said in a statement. “While all these issues can make focusing on retirement difficult, they also underscore the need for careful planning that doesn't just take in account the things you can control, but also factors in the impact of those you can't.”
The top three spots on this year's index were claimed by California metro areas-San Francisco, Sacramento, and San Diego, respectively. Indianapolis ranked last. To see the full report, click here.
Ameriprise Financial offers diversified financial services. It commissioned the survey, which was conducted online by New York-based Harris Interactive, Inc., between August 4 and August 12.