As participants struggle with concerns of inflation and market volatility, plan sponsors say they’re committed to preserving workers’ financial wellbeing.
MetLife’s 2025 Enduring Retirement Model Study, released Monday, shows that 82% of plan sponsors cannot imagine cutting retirement benefits, either because they believe it offers a competitive advantage in attracting and retaining talent (69% of respondents), demonstrates their commitment to the long-term welfare of employees (57%), or enables their workers to feel financially ready for retirement (52%).
Ninety percent of employers admitted to having workers who delay retirement because they feel financially strapped, while 64% believe employees are delaying retirement because they can’t afford it yet. A sizable group of employees also want to keep the medical insurance coverage they get through work (62%) and others want to continue building their retirement savings through a workplace plan (49%).
“Our study has shown that despite massive shifts in this space, employers remain steadfast in their commitment to providing workplace retirement benefits, including defined contribution [DC] plans and other post-retirement offerings, that help retirees live comfortably after they leave the workforce,” said Melissa Moore, senior vice president of Annuities at MetLife.
As the number of available defined benefit (DB) pension plans fall, leaving employees to fully fund their own retirement, employers say they understand why participants are concerned, MetLife reports. Ninety-three percent of plan sponsors say they recognize that retirees need a source of guaranteed income they cannot outlive, while 92% say the regression of pension plans has led to more dependence on DC plans to provide retirement income.
This sentiment has led a majority of plan sponsors to recognize that providing guaranteed income is one of the most importance financial decisions employers can make to protect employees’ retirement savings. Others (56%) say plan sponsors should reposition their DC plans as retirement income programs.
While respondents to MetLife’s survey are receptive to offering guaranteed lifetime income, past surveys show that the group may be an anomaly. A February DC Plan Sponsor survey from MFS found that while employers have evaluated implementing guaranteed income options to their plans, just 17% say they are “very” or “extremely” likely to incorporate a solution within the next 12 to 18 months, either because they are already “happy with their current plan design,” or due to low participant demand.
Instead, plan sponsors in the MFS report say they are analyzing their investment lineups and considering changes like “reducing or removing options, replacing managers, or adding options to their core menu.”
SEE ALSO:
Americans Short of Plans for Retirement Income
Employers Least Likely to Implement Retirement Income Solutions
CFP Professionals Worry About Retirement Income Amid Looming Tax Cuts
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with nearly a decade of experience and a passion for telling stories and reporting news. She is originally from Queens, New York, but now resides in Denver, Colorado.
