Data & Research February 21, 2017

Retirees in the West and Northeast Spend the Most

Spending is much less in the South, EBRI finds.
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Households with people between the ages of 65 and 74 spend very different amounts, depending on where they live, according to new research by the Employee Benefit Research Institute (EBRI).

Northeastern older households spend the most ($41,860), and when this is limited to just New England, it spikes to $46,019. On the other hand, those living in the West South Central region of Texas, Oklahoma, Arizona and Louisiana spend the least ($28,540).

For those between the ages of 50 and 64 living in New England, they spend nearly 2.5 times the amount on housing ($30,240) than those in the West South Central region ($11,948).

When it comes to health care spending for those 85 and older, Midwesterners spend an average of $3,480 a year—41.5% more than those in the next-highest spending region of the West ($2,460).

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Nationally, average household spending declines with age. In 2015, the average total annual spending for households between the ages of 50 and 64 was $53,087. For those 85 and older, it is $34,982. Housing is the largest spending category for all age groups above 50—ranging from 44% to 48% of total household spending.

“National benchmarks are important and helpful, particularly in shaping national policies,” says Sudipto Banerjee, research associate at EBRI and author of the report. “But individual retirees might find regional or local benchmarks that more closely reflect their personal situation to be more helpful.”

EBRI’s report about regional household spending can be downloaded here.

Data & Research February 21, 2017

Conservative Investors More Likely to Say Trump Presidency Will Help Portfolios

More than half of all investors say the administration will likely benefit their retirement portfolios.
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While the country remains divided in its reaction to Donald Trump being elected president, the same is true for investors, E*Trade found in its latest quarterly survey of investors.

Nearly 70% of conservative investors think the new administration will benefit their portfolio, but only 30% of liberals think so. However, both are nearly equally likely to make changes to their portfolio in reaction to the new president (57% of conservatives and 64% of liberals).

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More than half of all investors think the new administration will benefit their retirement portfolio. This is slightly higher for Boomers and Millennials (56% and 55%, respectively), but true of only 50% of those among Generation X.

Overall, 60% of investors are excited about personal tax cuts, but this jumps slightly to 64% of liberals and declines modestly to 58% of conservatives.

Despite their adverse reaction to Trump, nearly 70% of liberals like his infrastructure plans, while only about 30% of conservatives are enthusiastic about these plans.

Younger investors are more excited about the new presidency; nearly 70% of Millennials are most excited about personal tax cuts, compared to about 60% of Gen Xers and just over half of Boomers.

“We know that politics and passion go hand in hand, and are seeing that these factors are influencing investing decisions,” says Mike Loewengart, vice president of investment strategy at E*Trade Financial. “While deep-seated political beliefs may be difficult to curb, we always caution against emotional investing, urging investors to be guided by their head and not their heart.”

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