Where to we stand with annuity demand in 401(k)s? Pretty high, according to new research, although it’s unclear if the “A” word is ever used.
Faced with mounting worries over their finances and retirement outlook, six in 10 millennials say they are willing to sacrifice pay for more secure retirement benefits. The survey, released by Willis Towers Watson, found two-thirds of boomers would also be willing to sacrifice pay for more secure retirement benefits, versus half in 2009.
“Employees of all generations, including millennials, are feeling vulnerable about their long-term security,” Steve Nyce, senior economist at Willis Towers Watson, said in a statement. “Employees young and old actually have a strong desire for more retirement security and are willing to give up pay to get more guarantees or a larger retirement benefit. Interestingly, employees seem to be saying they have enough health coverage now and are reluctant to pay more.”
When asked how they would spend money if their employer provided them with an allowance to spend on a variety of benefits, millennials said they would allocate more than half to health care and retirement plan benefits.
Additionally, almost half of millennials ranked pay and bonus over all other benefits if given a choice, a “clear indication of their financial issues and need for more financial flexibility today,” according to the report’s authors.
Not surprisingly, millennials are also much more likely to embrace nontraditional benefits and work/life balance than boomers. Nearly one-third of millennials ranked more paid time off, greater opportunities for flexible work arrangements and career advancement, and options to purchase a wider variety of benefits as a top priority. That’s more than double the percentage of boomers who want these benefits.