What should boomers do about retirement savings in shaky economy?

What a new survey shows

As economic indicators head downward, many baby boomers interviewed in a survey say they’re less confident that their retirement savings will provide adequately for retirement.

Fifty-six percent of baby boomers said they’re less confident than they were three months ago that their retirement savings will last them through retirement, a survey conducted by Harris Interactive® on behalf of Longevity Alliance, a firm that sells financial products for older adults, showed.

Of those baby boomers with retirement savings, seven in 10 said they were “less confident” overall, with 35 percent being “somewhat less confident,” and 36 percent indicating they are “much less confident.”

Few of the boomers knew what steps to take next, survey results showed. About two out of five (39 percent) of boomers with retirement savings have changed or plan to change their retirement savings as a direct result of the current economic conditions. Of those boomers with savings who have made a change (or plan to), 43 percent say they would seek the advice of a financial advisor or retirement planning professional.

The survey found differences in attitudes about retirement between men and women:

Among adults of all ages, men are more likely than women to have retirement savings (78 percent vs. 70 percent).

Compared to male boomers, female boomers are much more likely to say they have less confidence in their retirement savings (61 percent of female boomers vs. 49 percent of male boomers).

The Retirement Planning survey was conducted online within the United States between Feb. 27 and Feb. 29, 2008, among 2,521 adults ages 18-plus, of whom, 831 are boomers.

What Suze Orman recommends

In January, I linked to a clip of Suze Orman on CNN’s Larry King Live in which she said people should leave their investments where they are during this economic downtown if they’re in good stocks, mutual funds, or exchange traded funds. She added for those about to retire in five months to a year, they shouldn’t be in the stock market to begin with. See my post Making Decisions About Investments Isn’t Easy Now.

Orman is still singing the same tune.

In another Larry King interview on March 26, Orman said ordinary investors should stay on the sidelines until the stock market settles down.

She thinks the economy is “not so bad,” and we’ve “gotten through the worst of it.”

Orman suggests cutting back on everything because gas and food, such as wheat and milk, are so expensive.

On spending your tax rebate, she repeated her mantra: don’t spend it, use it to pay off credit cards or other debts, or save it for retirement.

Orman will appear on The Oprah Winfrey Show Monday, March 31, 2008.