COVID-19 Has Many Americans Reevaluating Retirement Plans
Roughly two in five Americans (38%) say the COVID-19 pandemic has impacted their retirement plans by having to retire later than planned, now not being able to retire at all or being forced into retirement. Plus, 41% are currently reevaluating their retirement plans to assess the financial impact of COVID-19. These are among the findings revealed by a new COVID-19 Tax Survey conducted online in May 2020 by The Harris Poll on behalf of The Nationwide Retirement Institute® among U.S. adults 18+. Heightened uncertainty and complexity are driving a need for greater financial protection. Roughly half of Americans agree that the COVID-19 pandemic has made them recognize the need for annuities to protect their investments against market risk (47%) and to protect their retirement income (48%). More than half of all U.S. adults (57%) and investors (60%) also say the pandemic has made them recognize the need for life insurance.
More survey results can be found in the full article at the link above.
The heightened uncertainty and complexity have definitely affected my own retirement plans.
The massive number of people out of work have definitely affected my own thoughts and feelings about work.
Retirement = work.
As long as my health holds up and as long as there’s someone out there willing to pay me to do what I do I plan on working.
The ING International Survey Savings 2019, the eighth in an annual series, surveyed 14,695 people in Europe, the US, and Australia, and discovered the majority worry about not having enough money in retirement. The findings show that many people are “sleepwalking” into a financial crisis with little or no savings toward their golden years.
The ING International Survey Savings 2019 highlights the difficulties people are facing across Europe, the USA and Australia when it comes to meeting long-term savings goals, such as funding retirement. The survey, the eighth in a savings series repeated annually, canvasses the views of nearly 15,000 people in 15 countries, reveals that six in ten (61%) of non-retirees across Europe worry they won’t have enough money to live on when they retire. This is no surprise when you realise that high shares (27%) have no savings at all. Among this group, two-thirds (66%) tell us they simply don’t earn enough to put anything aside. And many who do have savings aren’t massively better off: 42% in Europe say they have no more than three months’ take-home pay put aside. Results from the USA and Australia are similar.
You can download the full study at this link.
The Financial Risk of Living a Long Time
People nearing the end of their careers can potentially lose 5% to 10% of their retirement wealth, or the equivalent of 2 to 5 years’ labor, by failing to annuitize their savings or annuitizing too early, according to an estimate by Alessandro Previtero of Ivey Business School in Canada. By providing a guaranteed income for life, an annuity is essentially an insurance policy against outliving one’s retirement savings. In a study, Previtero found that when stocks are rising, people are less likely to purchase annuities offered by their employers.
This excerpt came through my RSS reader this morning. As an insurance guy, naturally I was interested. When I clicked on the link to take me to the original Harvard Business Review blog article I got a 404. So I went to Google and found the article linked below.
No, I will not speculate on the reasons why HBR took their post down. Read the article and let your imagination roam.