The 1967 Italian epic spaghetti Western film, “The Good, The Bad and The Ugly,” directed by Sergio Leone and starring Clint Eastwood as “the Good,” Lee Van Cleef as “the Bad,” and Eli Wallach as “the Ugly,” cemented Eastwood’s emerging status as a box office-bankable, morally ambiguous antihero (and one badass Cowboy).
What does it have to do with retirement research, you ask? Nothing—other than the fact that the movie’s unique title also makes it a good—O.K. at least a different—way to distinguish between the incongruent findings in wide-ranging retirement research—such as that found in the recently released 32nd annual Retirement Confidence Survey (RCS), the longest-running survey of its kind measuring worker and retirement confidence. It was conducted by the Employee Benefit Research Institute (EBRI) and Greenwald Research.
So without further delay, here’s how some of the key findings in the new research break down as The Good, The Bad and The Ugly.
The Good
• Americans remain optimistic about living a comfortable retirement.
Unchanged from 2021, more than 7 in 10 workers said they are at least somewhat confident, including almost 3 in 10 who are very confident. Retirees also remain confident, with nearly 8 in 10 confident they will have enough money to live comfortably throughout retirement, including 1 in 3 who are very confident.
“Even with the concerns of the pandemic and rising prices, overall, American workers and retirees still feel positive about their retirements,” said Craig Copeland, director of Wealth Benefits Research, EBRI.
• Workers like their workplace retirement plans.
The EBRI research also found workers remain satisfied with their employer-based retirement savings plans and with the tools and resources available. More than 4 in 5 workers who are offered a workplace retirement savings plan are satisfied with the benefit. This is important given that workers (82%) remain far more likely than current retirees (47%) to expect their workplace defined contribution retirement plan to be a source of income in retirement.
The Bad
• Pandemic dampens retirement confidence of many Americans.
A third of workers and almost a quarter of retirees surveyed say the pandemic has made them less confident in their retirement prospects. The survey notes those feeling less confident were already among the more vulnerable and less retirement-ready Americans.
“The Americans who are more likely to feel that their futures appear grim since the pandemic are those who were already pessimistic about their futures, due to lower incomes, problems with debt, or lower health status.”
Given the recent spike in inflation, not surprisingly a third of workers and half of retirees who feel less confident cite inflation and the cost of living as the reason for their declining retirement confidence. In stark contrast, roughly 7 in 10 workers and retirees overall report being confident they will have enough money to keep up with inflation in retirement.
The Ugly
• Far too many Americans don’t know where to go or who to trust for financial and retirement planning information.
As part of its 2022 Retirement Confidence Survey, the Employee Benefit Research Institute asked more than 1,100 retirees to identify the people or groups they turn to for retirement advice. Notably, almost 4 in 10 workers and 2 in 10 retirees say they don’t know who to go to for financial and retirement planning advice. Many turn to non-professional sources, like family and friends (35% of workers and 21% of retirees) or going online to do their own research (29% of workers and 23% of retirees).
The really ugly part? A quarter of workers say they turn to their employer as a source of retirement planning information, ranking this potentially highly qualified source of advice behind advisors, family and friends, and online research when it comes to being the most trusted source of information.
Majorities generally believe that financial services companies understand how to help them with financial and retirement planning, and roughly a third of both workers and retirees currently work with a financial professional. Almost half of workers who don’t work with an advisor plan to work with one in the future.
Of note, 3 in 10 workers suggest they don’t feel fairly treated in the workplace, and a quarter report having trouble accessing employer-sponsored benefits for their dependents or beneficiaries.
SEE ALSO:
• Key 401k Portability Finding in EBRI’s Retirement Confidence Survey
• DC Plan Participant Retirement Confidence Exceeds Expectations
Veteran financial services industry journalist Brian Anderson joined 401(k) Specialist as Managing Editor in January 2019. He has led editorial content for a variety of well-known properties including Insurance Forums, Life Insurance Selling, National Underwriter Life & Health, and Senior Market Advisor. He has always maintained a focus on providing readers with timely, useful information intended to help them build their business.
