More than half (61 per cent) of U.S. employees nearing retirement age believe low interest rates combined with rising inflation will make it difficult to create a retirement income stream that will last their lifetimes, according to a new survey by Global Atlantic Financial Group.

It also found a quarter (24 per cent) of survey respondents said they’re extremely or very concerned about the impact inflation will ultimately have on their ability to live comfortably in retirement.

While nearly all (96 per cent) said they believe protected, guaranteed monthly income in retirement is important (35 per cent said it was extremely important), less than a quarter currently use annuities (24 per cent) or bonds (23 per cent) to protect their assets. Instead, most cited a mix of stocks and mutual funds (73 per cent) and two-thirds (67 per cent) cited cash equivalents as their ways to protect assets, in contradiction to fears of a stock market correction (66 per cent) and continued inflation (57 per cent) this year.

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The survey also found annuity owners are more confident about retirement security than non-owners — 62 per cent of those with an annuity believe the amount of money they’ve saved for retirement will last the rest of their life compared to fewer than half (48 per cent) of those without an annuity. Forty per cent of those without an annuity said they don’t know if the money they’ve saved will last the rest of their lives. And 48 per cent of annuity owners said they’re extremely or very comfortable with their investment asset and retirement protection strategy, compared to only 33 per cent of those without an annuity.

“External factors such as inflation, market volatility and interest rates are all valid reasons for people to be concerned about income as they approach retirement,” said Paula Nelson, head of strategic growth for individual markets at Global Atlantic, in a press release. “The findings in the study reveal that retirees and those approaching retirement are interested in the benefits of annuities but don’t know enough to make an informed decision.”

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