Seniors are experiencing longer retirements, as longevity rises and many choose to leave the workforce earlier.
Manulife John Hancock today released its Financial Resilience and Longevity Report, analyzing findings on each generation’s look into retirement. It provides insights on how age groups could prepare for retirement as more seniors live longer. According to the report, while the average life expectancy in the U.S. continues to be 79, the number of people ages 100 and older is expected to quadruple over the next 30 years.
At the same time, 52% of respondents said they quit working earlier than planned, with the average age being 56.
“People are living longer than ever, and there’s an opportunity and increased need to provide support to plan participants in preparing for a longer retirement,” said Aimee DeCamillo, global head of Retirement and Wealth at Manulife Wealth & Asset Management. “Our mission is clear: give employers and advisors the capabilities to help plan participants save earlier, invest smarter, and retire on their terms with security, and dignity.”
The research separated participants into their respective age groups and highlighted perspectives from each cohort. Gen Zers had the youngest ideal retirement age at 59, compared to Millennials at 61, Gen Xers at 64, and Baby Boomers at age 67. However, when asked when they expect to retire, Gen Zers listed 67 while Millennials, Gen Xers, and Boomers all answered age 69.
Younger workers were likelier to have poorer financial outlooks and worry about affordability. Fifty-two percent of Gen Z and 53% of Millennials rated their finances as fair or poor, versus 49% of Gen X and 34% of Boomers.
Meanwhile, despite some improvement with retirement savings, workers continue to feel off track. The slow pace underscores the role of plan sponsors, financial professionals, and financial institutions with workers’ retirement savings, Manulife John Hancock states.
This includes creating consumer experiences that allow participants to visualize the potential outcomes in retirement, while also integrating demographic-specific personalized education for participants to engage with colleagues who experience similar challenges. Advisors and plan sponsors can also incorporate video testimonials, where participants discuss their challenges and how they’ve overcome them. ‘
“Our research over the past decade shows that Americans continue to feel the pressure of rising costs and competing financial priorities, which has impacted their confidence in their retirement planning,” said Wayne Park, CEO of Manulife John Hancock Retirement. “That’s why we support our advisor partners and plan sponsors in motivating participants to take meaningful action today to build financial resilience for tomorrow. Even in the face of uncertainty, there are steps people can take now to prepare for longer, healthier lives.”