About 85 percent of Americans view their homes as a reliable source for funding their retirement, beating out other options such as IRAs, savings, and working in retirement, according to a report by Prudential Real Estate Affiliates Inc., the real estate brokerage franchise unit of Prudential Financial Inc.

The report, Building Security at Home, found that American homeowners believe the increase in the equity in their homes has been the most effective means of improving their retirement prospects. Just under half (44 percent) agree that their home is their most important financial safety net for retirement.

The report is based on surveys conducted for Prudential. Prudential Financial conducted a Workplace Report on Retirement Planning study that focused on retirement issues among near-retirees. About 1,023 full-time employed Americans 55-64 responded to questions about their retirement knowledge, goals, actions and plans for that report.

A second study, Roadblocks to Retirement, surveyed a cross-section of Americans in December 2004 as they contemplated both the year that had just passed and the coming year. That survey is on an online national random sample of 621 Americans between 30-69 who were asked about their financial priorities, retirement preparation and their retirement concerns and challenges.

About 65 percent of survey participants said historically high real estate values have significantly helped their outlook for a financially secure retirement, while about 28 percent said that job security have assisted their retirement preparedness and 20 percent credited increases in the stock market with retirement preparedness.

About 54 percent of participants said employment-based retirement plans improved their retirement outlook, and 42 percent said income growth is a contributing factor to their retirement future security.

The biggest threats to a secure retirement come from the increased cost of living (71 percent) and health care costs (70 percent), according to survey responses. “Increased home values have been one of the most effective counter-punches to cost of living and health care inflation,” Prudential said in an announcement about the surveys.

Other findings:

  • To access the equity in their homes and also to reduce living costs, 62 percent said they expect to move or downsize sometime in their retirement. While many recognize the potential need to sell their home, 18 percent will only do so in an emergency and 23 percent will hold on to their home as long as possible, selling later in retirement, according to the survey results.

  • About 75 percent of survey respondents indicated they do not know how to generate an income in retirement using home equity.

Prudential Financial companies offer a products and services including life insurance, mutual funds, annuities, pension and retirement-related services and administration, asset management, banking and trust services, real estate brokerage franchises, relocation services and – through a joint venture – retail securities brokerage services.

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