Before the COVID 19 pandemic, Americans said they planned to retire at age 62. Now, in the wake of the pandemic, rising costs from inflation and the uncertain economy, Americans are not planning to retire until age 65.
This according to just over 1,000 adults with some form of retirement savings responding to Franklin Templeton’s newest Voice of the American Worker Survey, conducted by The Harris Poll on behalf of Franklin Templeton and the Retirement Innovation Initiative (RII).
The survey shows American workers are feeling the impact of the current economic climate when considering their plans for retirement and are reacting accordingly.
Seventy-three percent of respondents agreed with the statement: “The soaring living expenses changed the way I envisioned my retirement.” However, they are still focused on saving for retirement with 57% saying they are more likely to contribute to their retirement account than to stop saving all together.
American workers are increasingly turning to their employers in search of more personalized support in improving financial well-being, with 70% agreeing with the statement, “When it comes to benefits, I would like more holistic options (i.e. assessing all of my financial goals together) to address the current economic climate.”
Personalization and customization go a long way when it comes to American workers’ retirement savings behaviors with three-quarters (77%) stating they’d be more likely to participate or contribute more to their retirement savings if there were more personalized 401(k) investment options.
“Now more than ever, employers have an opportunity to retain top talent by offering their employees comprehensive financial wellness tools and personalized solutions,” said Jacque Reardon, Vice President – Head of Client Experience for Retirement, Insurance, 529, & Wealth Management at Franklin Templeton.
More specifically, 78% said they would be interested in a more personalized 401(k) investment option tailored to their unique financial situation (such as a personalized portfolio using factors such as age and income). And 75% said if their employer offered a customized managed account solution as an option in their 401(k) plan, they’d be more likely to stay in that plan if they retire or change employers.
Additionally, more than 8 in 10 respondents said they would be interested in a deferred annuity benefit, but only 2% of their employers offer such a benefit.
The survey also found workers were most interested in increased pay and increased 401(k) matching. Demand for increased salary jumped more than 10% in 2021 from 2020, surpassing 401(k) matching as the most-desired benefit among American workers.
“For employers across the country, there has never been a more urgent time to evaluate benefit offerings and consider ways to evolve how they are supporting employee needs,” added Yaqub Ahmed, Head of US Retirement, Insurance & 529 at Franklin Templeton. “With turnover at an all-time high, improving employee well-being is vital to the health of any business. Having a deep understanding of the current mindset of the American worker will help employers determine how best to meet their expectations.”
See the full survey here.
SEE ALSO:
• Workers Reevaluate What They Want From Employers
• Hybrid 401(k)s, Protected Income and More: Quick Takes from the VCI Leaders Summit
• More Women Concerned on Ability to Retire than Men
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.
