The current economic climate has sparked a growing interest among retirement savers in seeking guaranteed lifetime income products and exploring financial planning options, according to a recent survey conducted by Morning Consult on behalf of the American Council of Life Insurers (ACLI). The study, which surveyed over 1,000 retirement savers aged 45 to 65, highlights a significant shift in the mindset of pre-retirees who are seeking more stability and security for their financial futures.
Over half of the respondents, comprising both high and low earners, revealed that the state of the economy has prompted them to consider “a guaranteed lifetime income product that pays out like a pension.” Interestingly, Hispanic and Black participants, along with those identifying as “other,” displayed a stronger inclination toward these products compared to White respondents. This disparity suggests that certain demographics may be more attuned to the benefits offered by guaranteed lifetime income products in the current economic climate.
The survey also unveiled that an overwhelming 91 percent of respondents prefer the freedom to work with any financial professional who can provide them with products and services tailored to their individual needs. This preference emphasizes the importance of personalized financial advice and the value of flexibility in selecting the right financial partner.
Susan Neely, the President and CEO of ACLI, noted that retirement savers are grappling with concerns over inflation and the overall state of the economy. In light of these concerns, guaranteed lifetime income products offered through annuities, along with access to comprehensive financial planning options, emerge as viable solutions to address the uncertainties surrounding retirement.
Survey sheds further light on retirement savers
The survey’s additional findings shed further light on retirement savers’ perspectives and aspirations. A significant majority, 66 percent, agreed that long-term planning is a complex endeavor, highlighting the need for diverse retirement options. The importance of having a financial plan specifically tailored for retirement was unanimously endorsed by 95 percent of respondents, showcasing the recognition of the necessity for proactive financial preparation.
Furthermore, the survey revealed that worries about the future loom large, particularly in light of the current economic climate. An overwhelming 81 percent of respondents expressed concerns about whether their savings will be sufficient to sustain them throughout their retirement years. This anxiety further drives the desire among retirement savers to safeguard their nest eggs, with 73 percent indicating an interest in independently purchasing a guaranteed lifetime income product that mirrors the stability of a pension, even among those who do not currently possess a pension themselves (68 percent).
The desire for options when considering retirement was also evident in the survey’s results, with over 90 percent of respondents emphasizing the importance of providing Americans across varying income levels with a range of choices when it comes to retirement planning.
Susan Neely, while discussing the implications of the survey’s findings, highlighted their relevance to the ongoing discussion surrounding the Labor Department’s potential implementation of a fiduciary-only regulation. She pointed out that the previous existence of such a regulation, which was subsequently overturned by a federal court in 2018, impeded access to the very products and services that consumers are now indicating a strong desire for.
The survey, conducted online by Morning Consult from May 10 to May 15, encompassed a nationwide sample of 1,003 employed adults aged 45 to 65 who are actively preparing for retirement. The margin of error for the survey is estimated to be plus or minus 3 percent, ensuring a reasonably accurate representation of the sentiments expressed by the respondents.