Despite six in 10 employed workers (60 percent) having made adjustments due to pandemic-related financial strain, 82 percent are saving for retirement, according to Living in the COVID-19 Pandemic: The Health, Finances, and Retirement Prospects of Four Generations, released today by nonprofit Transamerica Center for Retirement Studies (TCRS) in collaboration with Transamerica Institute.
As part of TCRS’ 21st Annual Retirement Survey of Workers, one of the largest and longest-running surveys of its kind, the new study examines the retirement outlook of Generation Z, Millennials, Generation X, and Baby Boomers.
It is based on a survey of employed workers conducted in late 2020 and contains recommendations for workers, employers, and policymakers to improve retirement security.
“Workers are weathering a public health crisis and contending with fears about the virus and vaccinations, concerns for family and friends, employment impacts, and financial setbacks,” said Catherine Collinson, CEO and president of Transamerica Institute and TCRS.
The survey findings illustrate the experiences of workers across generations that can impact their health, financial well-being, and ability to save and invest for retirement:
SIX IN 10 HAVE MADE ADJUSTMENTS DUE TO PANDEMIC-RELATED FINANCIAL STRAIN, including reducing day-to-day expenses (32 percent), dipping into savings accounts (24 percent), accumulating new credit card debt (17 percent), reducing or stopping contributions to retirement accounts (14 percent), forgoing health care (14 percent), borrowing money (13 percent), moving (nine percent), and stopping rent or mortgage payments (seven percent). Millennials, Generation Z, and Generation X (71 percent, 69 percent, 59 percent, respectively) are more likely than Baby Boomers (40 percent) to have made any adjustments.
FORTY-THREE PERCENT EXPERIENCED ONE OR MORE NEGATIVE IMPACTS TO THEIR EMPLOYMENT, including reduced hours (27 percent), reduced salaries (14 percent), furloughs (10 percent), layoffs (eight percent), and early retirement (four percent). Generation Z (59 percent) is more likely to have been negatively impacted than Millennials, Generation X, and Baby Boomers (51 percent, 39 percent, and 30 percent, respectively).
SIXTY-TWO PERCENT CITE PAYING OFF ONE OR MORE TYPES OF DEBT AS A FINANCIAL PRIORITY. Generation Z (35 percent) is more likely to cite paying off student loans, while Millennials, Generation X, and Baby Boomers are somewhat more likely to cite credit card debt (43 percent, 42 percent, and 37 percent, respectively).
EMERGENCY SAVINGS ARE LOW. Workers have only $5,000 (median) in emergency savings to specifically cover the cost of unexpected major financial setbacks. Emergency savings increase with age: Generation Z workers have saved $2,000, Millennials have saved $5,000, Generation X have saved $6,000, and Baby Boomers have saved $10,000 (medians).
ALMOST ONE IN FOUR ARE SERVING AS CAREGIVERS. Twenty-four percent of workers are currently serving as caregivers for a relative or loved one. Millennials (30 percent) and Generation X (26 percent) are more likely than Generation Z and Baby Boomers (18 percent and 12 percent, respectively) to be caregiving.
SIX IN 10 ARE CONCERNED ABOUT PHYSICAL AND MENTAL HEALTH. Sixty-six percent of workers are concerned about their physical health, and almost as many are concerned about their mental health (60 percent). Generation Z and Millennials (72 percent and 70 percent, respectively) are more likely to be concerned about their mental health, compared with Generation X and Baby Boomers (59 percent and 42 percent, respectively).
-PR NEWSWIRE
