Americans are living longer, and therefore must apply new approaches to their overall wellbeing.
New research from Transamerica and the Massachusetts Institute of Technology (MIT) AgeLab says employers and financial professionals can inspire individuals to lead a different life from generations before, with the help of improved financial literacy and wellness education.
“What our data shows, and what we are seeing in the marketplace across generations, is that the way we approach our lives and the way we work is changing. People want flexibility and choice in all parts of their life, both at work and home,” said Phil Eckman, president of Workplace Solutions at Transamerica, in a release. “Employees are eager to live their best lives. And employers have a powerful opportunity in this new world of work to establish values that focus on the whole person and invest in solutions that support employees’ mental, physical, and financial health.”
The study, “Longevity as Opportunity – New Conversations on Work, Finance, and Well-Being,” surveyed a dozen focus groups and 1,200 individuals, and broke down the research into three key themes: work, finances, and wellbeing. Researchers then split respondents into three groups: young adults (ages 20 to 39), adults in midlife (ages 40 to 59), and older adults (ages 60 and up).
The research found that wellbeing and retirement continue to factor in how people view their longevity, as 92% of respondents said saving enough money to retire was very or somewhat important. Still, respondents noted the challenge of saving efficiently for retirement—33% do not expect to retire at all, and instead, say they are prepared to continue working in later life.
Supporting individuals across each age group
Younger and midlife adults were likelier to rank saving for retirement as among their top three desired topics of financial information, at 24% and 34%, respectively. Twenty-six percent of midlifers said they would want to know how much money they need for retirement.
Older adults, on the other hand, wanted information on making decisions around Social Security or Medicare (39%) and managing their retirement portfolio/mix of assets, funds, and bonds in their retirement accounts (23%). Converting retirement savings to income streams ranked low across all groups, at 7.5% for younger adults, 11.1% for midlife adults, and 19.1% for older adults.
Younger adults were found to be more invested in their wellbeing, as 36% were likelier to spend over $100 on their wellbeing every month—significantly larger than any other age group. This group was also likelier to express interest in returning to school and finding passion in their work.
Their top savings priorities included having sufficient funds for emergency savings (44%) and building wealth (34%). Saving for retirement ranked last for younger adults, at only 26% of respondents.
According to the research, financial professionals working with these groups should educate younger adults on the impact of longevity and supporting their younger clients with near-term financial goals while helping them anticipate long-term financial decisions.
A vast majority of midlifers are experiencing multiple responsibilities—including childcare, navigating their own career, and caring for aging parents. Respondents in this age group struggled to maintain wellbeing, with many saying they are just getting by. Only 57% of respondents in this group expect to retire, and 26% want more information about managing debt.
Transamerica and MIT AgeLab suggest financial professionals serve as “agenda setters” for midlife clients and act as support beams for those navigating near-term responsibilities like caregiving, while helping them anticipate long-term care for themselves.
A majority of respondents (58%) in the older adult age group had retired earlier than they planned to, and those left in the workforce cited financial benefits as their top priorities. For this group, the research recommends advisors and financial professionals continue supporting their clients either in or out of retirement. For those in retirement, professionals can help their clients transition from financial accumulation and savings to decumulation and spending.
More findings from the study can be found here.
SEE ALSO:
- More Pre-Retirees Considering Retirement Delays
- Americans In the Dark With Longevity Literacy
- Over Half of DC Investors Lack Longevity Literacy: Nuveen
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.
