NEW YORK (Reuters) - As the U.S. economy buckles, executives are delaying retirement, cutting back on their pension savings and trimming contributions to their children’s college funds, according to a survey released on Thursday.
A large majority of 86 percent plan to keep working an average of seven and a half years longer due to their shrinking retirement savings, said the poll by TheLadders.com, an online recruiting firm, that surveyed 1,162 executives.
“Nobody’s been spared,” said Robert Turtledove, spokesman for TheLadders.com, which caters to the job market for those earning $100,000 a year and more.
“This is investment-savvy, smart-managing, high-earning executives. It’s not a knee jerk reaction. I think it’s saying that wherever you are, this is impacting everybody,” he said.
Most executives making more than $100,000 a year have a specific target for retirement and college fund goals and, with Wall Street reeling from the financial crisis, it will take much longer to reach those goals, he said.
Retirement accounts, such as 401k contribution plans and IRAs, lost $2.8 trillion between September 30, 2007 and December 2, 2008, as the U.S. stock market dropped 47 percent, according to the Urban Institute based in Washington.
With equities losses continuing, 58 percent of executives said they stopped contributing to their 401k retirement accounts altogether, the survey found.
Half of the executives said the recession would limit their children’s college prospects, and 40 percent said they had stopped investing in their children’s college savings accounts.
With job cuts and shrinking bonuses, 40 percent of those polled said they were forced to use retirement savings to weather the recession.
The number of Americans filing for first-time jobless benefits hit a 26-year high last week, while Wall Street has cut its work force in New York more than 10 percent over the last 14 months.