New research suggests 401(k) savers and other retirement plan participants are a responsible, hopeful bunch.
Those who contribute to a retirement account are far more likely to own life insurance than those who do not participate in a plan. And more often than not, they are optimists, too.
The findings stem from consumer data gathered by American International Group, better known as AIG.
“We’re continuing to assess consumer mindsets, behaviors and needs, and respond with products designed to help people facilitate financially fulfilling futures,” Rod Rishel, chief executive officer of Life Insurance at AIG, said in a statement. “With September being Life Insurance Awareness Month, now is a perfect time for financial professionals to educate their clients about key protection and retirement planning solutions for themselves and their loved ones.”
More specifically, the study found that almost seven in 10 (69 percent) participants in group retirement plans, such as 401ks and pension plans, also own life insurance.
This is compared to 44 percent of people who do not contribute to employer-sponsored retirement accounts but do own life insurance.
Among those who own an individual retirement account, such as an IRA, 64 percent also own life insurance. Meanwhile, only 37 percent of Americans without an IRA or similar plan do.
Focusing in on respondents who are policyholders, AIG also found:
- People with life insurance have a greater tendency to have an optimistic outlook than those who do not (56 percent versus 48 percent), agreeing with statements like “In uncertain times, I usually expect the best,” “I’m always optimistic about my future” and “Overall, I expect more good things to happen to me than bad.”
- Life insurance owners are older and more affluent than non-owners, with a median age of 43 among those with a policy, compared to 39 for non-owners. The median annual income of life insurance owners is $88,000, versus $70,000 for non-owners.
- Individuals with life insurance are more likely than those without it to work full time (71 percent versus 60 percent), be homeowners (76 percent versus 64 percent) and be married (64 percent versus 53 percent).
- In general, 53 percent of Americans between the ages of 21 and 64 carry a policy.
“The implication is that younger, less affluent consumers are underserved when it comes to life insurance,” Rishel said in summary. “However, affordable solutions, such as customizable term life insurance products, are available…to help meet the needs of the underinsured, whether or not they participate in a formal retirement plan.”
Jessa Claeys is a writer, editor and graphic designer.
