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Birthdays are cause for celebration but they can also prompt people to examine their life situation. A recent LIMRA Secure Retirement Institute study found more Americans aged 55-75 with financial assets of $100,000 or more began planning for retirement when they reached a significant birthday (36 percent) than for any other single reason.

What’s the magic age?

When individuals who said that reaching a significant birthday triggered retirement planning were asked at what age they started planning, 20 percent said they began retirement planning at age 65 – the most widely recognized age of retirement in the U.S. Eleven percent began at age 60; 10 percent started at ages 55 and 70; and 7 percent began at age 62 (the earliest age that one can apply for Social Security).

But not all financial plans are equal. The study found that while 75 percent of pre-retirees and retirees who work with a financial professional have some sort of retirement plan, only 16 percent of those have a formal written plan.

Prior Institute research shows Americans who have a formal written retirement plan are more likely to feel more confident they are saving enough for retirement and more than twice as likely to feel very prepared for retirement as those without one.  Pre-retirees and retirees with a formal written plan are also more likely to convert a portion of their assets into an annuity within two years. The study found 70 percent of those with a formal written plan purchase a product to implement their retirement plans.

If it’s your birthday – have cake and enjoy your day!  But also reflect and consider how prepared you are for retirement. Would a formal written retirement plan help you achieve your retirement goals?  Our research strongly suggests it will.