Retirement planning is at the forefront of Merrill Lynch's wealth management activities in the US, the head of the firm's wealth unit said yesterday as a survey by the firm revealed that affluent citizens are increasingly worried about paying for retirement and healthcare.

Retirement worries among clients have become so pronounced, said Sallie Krawcheck, president of global wealth and investment management for Bank of America, Merrill’s parent company, that retirement planning is now “at the forefront of what we’re doing".

More than 60 per cent of individuals with investible assets of $250,000 or more who were surveyed expressed concern about outliving their retirement assets and also said they were concerned about health care costs, according to the Merrill Lynch Affluent Insights Quarterly Survey.

Nearly half of all affluent US citizens between the ages of 35 to 50 assume that Social Security will not play a role in their retirement, according to the survey, and nearly 70 per cent are skeptical about Medicare, believing it will play little to no role in offsetting medical expenses during their retirement years.

Speaking in a conference call to journalists, Krawcheck said the bank's decision to target retirement planning as a top priority was demonstrated by BofA’s advertising budget around retirement issues, investments the bank had made in the area and the recent promotion of Andy Seig to head the bank’s retirement and philanthropic services.

Retirement concerns, Seig said, have been “driving conversations” with clients, noting the 15,000 Roth IRA conversions Merrill did in the first quarter.

The survey showed that affluent baby boomers ages 51-64 are the group most concerned about whether their assets will last throughout their lifetime (73 per cent) and whether they will be able to live the lifestyle they had hoped to in retirement (61 per cent).

In fact, 40 per cent of survey respondents in this age range said expect to retire later than they did one year ago.

Nearly one-third of these individuals, the survey revealed, are currently supporting, in some or most ways, both their children and parents.

Often referred to as the “Sandwich Generation,” more than 45 per cent of this group said they have had to make lifestyle sacrifices to support the needs of their family.

Forty-four per cent of the group has significantly cut back on personal luxuries, 26 per cent are now saving less for retirement, and 19 per cent have invited their adult-age children and/or parents to live with them in order to help cut down on monthly expenses across the family.

Overall, maintaining the lifestyle to which they are accustomed is affluent Americans’ top short-term financial concern (36 per cent).

The survey also revealed “striking gender differences.” Seig said.

For example, 70 per cent of women surveyed expressed concern about rising costs of health care, compared to 54 per cent of men. Slightly less than half (45 per cent) of those over age 65 surveyed said they planned to dedicate time to philanthropic endeavors.

Seig said he expected this number to rise as baby boomers retire. “Engaging in causes of all types will intensify,” he said.