Workers saving for retirement today are concerned that they are going to outlive their savings or that they may not enjoy the same kind of comfortable retirement that previous generations did, according to a recent DC Pulse survey from BlackRock. Plan participants, sponsors and retirees alike emerged from the pandemic with a sharpened focus on retirement security and the importance of retirement income, the findings showed.
Among the survey findings:
- Three-fourths of participants are looking for help to get through retirement, not simply reach it.
- Eighty-one percent said it would be helpful if their employer provided secure income- generating options in their workplace plan.
- Thirty-seven percent of participants are more interested in owning a product designed specifically to generate income in retirement.
- Plan sponsors are committed to helping improve the holistic well-being of employees, and emergency savings is top of mind. A lack of emergency savings can hold participants back from realizing their retirement goals achieving positive well-being – 56 percent said they would save more for retirement if they had an emergency savings fund set aside.
- Nearly half of participants said that feeling confident about their short-term finances makes them feel more confident about their long-term finances.
Those already retired have greatly benefited from access to guaranteed income when available. Two-thirds of retirees feel confident they have enough money to last throughout retirement because they have a pension or other source of income, which was the most common reason. An even larger percentage, 76 percent, say it makes a bigger difference than they thought it would.
Sponsors see the important role that secure income plays in retirement. Eighty-six percent agree that their plan participants would benefit from a target date fund that has a feature that generates guaranteed retirement income.
And interest in income products is rising: Eight in 10 sponsors who do not currently offer a specific retirement income product are likely to add one in the next 12 months.
“All plan participants polled for DC Pulse were employed full-time and had access to a workplace retirement plan at the time of the survey,” the survey report concluded. “Meanwhile, 57 million Americans don’t have access to one. Over the course of the pandemic, millions of people were laid off, furloughed, took loans from the plans that they did have or were impacted in other ways that affected their ability to save.
“When it comes to retirement savings, it isn’t always an even playing field, but we can improve. The knowledge we gleaned from the DC Pulse survey can inform and help everyone as we move forward. Coupled with potential changes in retirement policy, we can use this information to help build better retirements.”