Benefits February 27, 2002

Money Buys Happiness

February 27, 2002 - People who are healthy and wealthy with a guaranteed pension income are most likely to have the happiest time in retirement.
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That none-too-surprising conclusion was the result of a new RAND study, MetLife Retirement Crossroads Study: Paving the Way to a Secure Future, conducted for MetLife Retirement & Savings and the MetLife Mature Market Institute.

After analyzing ten years of retiree data, RAND researchers found that, among other rather obvious conclusions,

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  • retirees who can pay the highest percentage of their expenses from their income stream, as opposed to their savings, have the highest satisfaction level,
  • those who have both money and good health are more likely to be satisfied in their retirement than those who are ill, and
  • retirees with a guaranteed lifelong pension are more satisfied for longer than those without a guaranteed pension

Satisfaction Declines

Among those without guaranteed income streams, satisfaction declines over time with the percentage saying they are very satisfied dropping from 58% shortly after retiring, to 47% a decade or more later. Researchers said that might be because retirees are anxious about outliving their savings.

Results of the survey also show that:

  • people who have attended an investment education class or met with an advisor are more satisfied that those who haven’t, and
  • some 71% of retirees who had a financial advisor say they are very satisfied with their retirement versus 59% of those who didn’t have expert advice

What detracts from retirees’ general satisfaction levels? Their health and the potential need for long-term care proved major issues. For example, 71% of those with long-term care insurance coverage versus 57% of those without this coverage reported being very satisfied with retirement.

Researchers said retirees interviewed in a series of focus groups conducted as part of the RAND study had “given surprisingly little thought to retirement planning” during their work lives.

The survey also found that :

  • only 46% said they thought retirement income will keep up with inflation, and
  • 59% believe that Congress is likely to make Social Security less generous than it is now


The RAND report was based on interviews with 20,000 over age 50 over a ten year time period period.

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