BlackRock Study: Confidence in Retirement Security Declines for the First Time Since Before the Pandemic
19 Julho 2022 - 09:00AM
Business Wire
- Across generations and multiple demographics, fewer Americans
believe they are on track for retirement as a result of inflation
and market volatility
- Nearly half of savers who don’t have a workplace retirement
plan keep their savings in cash
- Gen Z is putting aside 14% of their earnings for retirement –
more than any other generation
More Americans (37%) spanning generations and demographics feel
unprepared or unsure if they are on track for retirement compared
to the previous three years, with more women than any other group
(47%) reporting a lack of confidence, according to BlackRock’s
seventh annual retirement survey, The BlackRock Read on
Retirement. For the first time in several years, the
data shows a notable decline in confidence amongst savers who are
participating in a workplace retirement plan, down from peak levels
(68%) during 2021. Among savers who did not have access to a
workplace retirement plan, only 51% feel they are on track for
retirement.
Inflation is a key driver for the decline in confidence, and
nearly all (87%) workplace savers reported they are concerned about
inflation impacting their retirement. These savers also report a
decrease in spending on big ticket items (54%) and consumables
(42%) as a result. Most of all respondents (64%) are also worried
about their nest egg lasting throughout their lifetime – a data
point that is even higher among Black/African American (75%),
Asian/Pacific Islander (71%) and Hispanic/Latino respondents (67%).
Likewise, a majority of plan sponsors (69%) reported they are
worried about inflation wearing down their plan participants’
retirement savings, and nearly all employers and savers (90%) are
interested in investment options that would provide guaranteed
income in retirement.
Savings rates across workplace plan participants were a positive
finding in the research. Across generations of Americans currently
in the workforce, the most in modern history, youngest workplace
savers (Gen Z) are demonstrating the strongest retirement savings
discipline. The study found this group is setting aside an average
of 14% of each paycheck, compared to 12% for other generations
(Millennials, Gen X, and Boomers). However, one-third of Gen Z
respondents believe they can retire comfortably with less than
$250,000, compared to half of Baby Boomers who reported they would
need $1 to $3 million to retire. In contrast, 17% of savers with no
access to a workplace plan are not contributing anything at all to
retirement, compared to just 1% of workplace savers with access to
plans.
Anne Ackerley, Head of Retirement at BlackRock, said: “As we
experience new market headwinds that could impact the retirement
security of millions of Americans, it’s a critical time for our
industry to ensure people are planning for retirement with
confidence and clarity. While it’s encouraging to see double-digit
savings rates across every generation, we have work to do to help
more Americans reach retirement with dignity and on their own terms
- particularly those without access to employer savings plans, and
women and people of color.”
Key Findings:
- Retirement confidence varies across generations, with a
high percentage of Millennials (19%) and Gen X (22%) reporting they
are not on track for retirement compared to Boomers (12%).
Plan sponsors are also concerned about retirement readiness, and
report that, on average, only 58% of their employees are on track
for retirement, down from 63% in 2021. Gen Z, who was included in
the survey for the first time this year, reported the highest level
of confidence (69%) in their retirement outlook.
- Interest in retirement income is higher than ever, with
87% of workplace savers willing to invest a portion of their
retirement savings in exchange for guaranteed regular income
payments (up from 71% last year.) Similarly, 74% of employers said
that retirement income has become more important for their
employees, and 90% agreed that plan participants would benefit from
a target date fund (TDF) that generates guaranteed retirement
income.
- Savers without access to a workplace retirement plan are
most at risk of being unprepared for retirement, with
46% reporting they are holding at least some of their savings just
in cash, missing out on wealth-generating opportunities. This group
also reported low familiarity with common retirement vehicles such
as TDFs (41%), but when given a description of these vehicles, 66%
reported high interest, highlighting a key opportunity for
investment education.
- Women and diverse communities show differing levels of
retirement confidence. Only 53% of women said they feel on
track with their retirement savings, compared to 63% of all
workplace savers, and 73% of men. Among diverse groups, sentiment
varies, with 65% of Black/African Americans, 57% of Hispanic/Latino
respondents and 51% of Asian/Pacific Islander respondents saying
they are on track for retirement.
- Younger workers are saving more but need guidance on goal
setting. Gen Z workplace savers are heeding the
retirement industry’s decades-long push to save more - however, a
third of these respondents believed that savings of under $250,000
would be sufficient to retire comfortably, signaling that this
group may need more education on planning for decumulation in
retirement. Gen Z showed the highest familiarity with retirement
strategies such as TDFs. Likewise, 51% of Millennials report that
they are invested in TDFs, and of this group 38% have no plans to
change their allocation – a higher percentage than any other
generation.
About The BlackRock Read on Retirement
The BlackRock Read on Retirement, formerly known as the
BlackRock DC Pulse Survey, provides insights from a research study
of over 300 large defined contribution plan sponsors, 1,300
workplace retirement plan savers, 1,300 independent savers, and 300
retired workplace savers in the United States. The survey is
executed by Escalent, an independent research company. All
respondents were interviewed using an online survey conducted March
25 - April 30, 2022.
About BlackRock
BlackRock’s purpose is to help more and more people experience
financial well-being. As a fiduciary to investors and a leading
provider of financial technology, we help millions of people build
savings that serve them throughout their lives by making investing
easier and more affordable. For additional information on
BlackRock, please visit www.blackrock.com/corporate | Twitter:
@blackrock | LinkedIn: www.linkedin.com/company/blackrock
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version on businesswire.com: https://www.businesswire.com/news/home/20220719005352/en/
Thomasin Bentley 646-231-1769
thomasin.bentley@blackrock.com
Kristen Rivera 646-231-8352
kristen.rivera@blackrock.com
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