Dive Brief:
- An improved financial situation and even retirement confidence are not enough to persuade 23% of 5,100 U.S. employees that they can kick back and stop working well before they hit age 70, according to new survey.
- The Global Benefits Attitudes Survey, from Willis Towers Watson, reports some of those workers (5%) aren't sure if they will ever be able to afford to retire, with another 32% anticipating they will retire later than previously planned.
- According to the survey, while the average U.S. employee expects to retire at age 65, they admit there is a 50% chance of working to age 70. 62% of respondents would be willing to pay more out of their paychecks for more generous retirement benefits.
Dive Insight:
In terms of demographics, 24% of employees under age 30 believe they’ll retire in their 70's or later, increasing to 28% of those in their 30's and 33% of those in their 40's. The trend of working longer has been happening for years, as the percentage of U.S. men aged 65 or older who are working has grown from 15% in 2003 to 22% last year.
Steven Nyce, a senior economist at Willis Towers Watson, explained that while many peoples' financial situations have improved in the past few years, concerns over long-term financial stability remain. "In fact, the only way for many employees to achieve retirement security and overcome inadequate savings is to work longer," he says. "Interestingly, employees are increasingly looking to their employers for help with retirement.”
There is more bad news. The survey found 40% of employees expecting to retire after age 70 have high or above average stress levels, compared with 30% of those expecting to retire at 65. For those planning to retire after age 70, less than half (47%) say they are in very good health, while nearly two-thirds (63%) of those retiring at age 65 state they are in very good health.
With nearly eight in 10 workers expecting to rely on their employer retirement plan(s) as the primary vehicle they use to save for retirement, employers have plenty of motivation to do something now. Among other things, it might be time for HR and employers to personalize their real-time decision-making support and recalibrate default enrollment to close the gaps in employee understanding.