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Shock (Not)! Link Between Health, 401k Financial Wellness

Retirement requires good financial habits, healthy lifestyle

retirement, 401k, health, wellnessRetirement health is critical all around.

Talk about a win-win. For anyone still ambivalent about the benefits of financial wellness (calling all CFOs), here’s another piece of ammunition for every 401k advisor.

Benefits bigwig Aegon found that health and wealth in retirement are closely linked, yet a “stark gap” exists with both when it comes to people’s expectations versus the reality.

“Finding ways to develop good savings habits and maintain a healthy lifestyle from an early age are key factors for a successful retirement,” Mike Mansfield, manager of retirement research at the Aegon Center for Longevity and Retirement, said in a statement. “Individuals, employers, the retirement industry, and governments, all have a role to play in promoting healthy aging and long-term financial security.”

Preparing for a successful retirement obviously requires focus on good financial habits and a healthy lifestyle.

“Many workers now envision fully retiring at an older age,” Mansfield added. “For many, retirement has become a transition that offers the promise of continued work, albeit at a more relaxed pace, with more time to enjoy life. However success in achieving this largely depends on workers’ health and financial ability.”

Globally, only 39 percent of workers describe themselves as habitual savers (i.e., they say they are “always” saving for retirement). Twenty-four percent are occasional savers, 19 percent are aspiring savers, 12 percent are past savers, and six percent are non-savers.

Only 14 percent of workers have a written plan for retirement. This group is significantly more likely to turn their good financial wellness intentions into actions. Seventy-four percent say they are always saving for retirement, which is well above those with an unwritten plan (48 percent) or those with no plan at all (19 percent).

Additionally:

  • Sixty-eight percent of people describe their health as “good” or “excellent” and 82 percent of people say their health in older age is a concern. Yet only 43 percent say they think about long-term health when making lifestyle choices.
  • Fifty-seven percent of workers envision continuing some form of work in retirement. The harsh reality, however, is that 39 percent of retirees retired sooner than planned, with 29 percent of them doing so due to ill-health.
  • Ninety-one percent of workers say they would be interested in at least one health- and wellness-related offering by their employer (e.g., healthy food at the office, gym discounts, or preventative screenings and vaccinations).

In 2017, the global Aegon Retirement Readiness Index reached 5.92. While still a ‘low level’ of preparedness, it represents a slight improvement since 2016.

The report, the result of Aegon’s sixth Annual Retirement Readiness Survey, draws on findings from workers and retirees from 15 countries spanning Europe, the Americas, Asia, and Australia.

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