COLUMBUS, Ohio, Jan. 12, 2022 /PRNewswire/ — The pandemic has shaken women’s confidence in retirement planning according to a recent Nationwide Retirement Institute® survey of employer-sponsored retirement plan participants and sponsors. About one in five (18%) women feel they are on the wrong track for retirement, and the same percentage expects to retire later than the originally planned due to the pandemic.
Fewer women than men have been able to hit financial milestones such as contributing to a 401(k)/IRA (50% of women vs 58% of men), building an emergency fund (47% of women vs 59% of men) or increasing their retirement plan contributions (39% of women vs 51% of men).
Retirement plan sponsors have taken notice of these challenges, too, with 70% saying they believe female participants are more likely to have been financially impacted by the pandemic than men. A major factor could be family responsibilities — one in three women report they had thought about leaving their jobs or downshifting their careers in 2021, compared to one in four in 2020.
As a result of these factors, many women are experiencing negative emotions when thinking about their current retirement plan status, including being worried (34%), frustrated (15%) or panicked (10%).These percentages are even higher for women who have delayed or cancelled their retirement plans, with 45% feeling worried, 54% frustrated and 16% panicked. In fact, 51% of women who have delayed or cancelled their retirement plans say the decision has negatively affected their mental health.
“Working through the pandemic hasn’t been easy for anyone. This is particularly true for women, who are balancing child or elder care challenges and career burnout” said Amelia Dunlap, vice president, Retirement Solutions Marketing at Nationwide. “This only adds to the stress that women are facing, feeling off course from their overall financial and retirement goals.”
The good news is women are turning their energy into action. Since the pandemic began, 66% of plan sponsors have noticed that women are more likely to make changes to their retirement plans than men. Of the women who are expecting to delay or cancel their retirement plans, 67% say they’ve shifted their overall approach to saving for retirement in response.
The survey found women are also interested in exploring solutions that can help them reach their goals. About half (48%) of female participants showed interest in in-plan guaranteed lifetime income investment option, more than any other option provided to them. About one in three (35%) are likely to roll over their retirement savings into one if given the chance. The female participants who don’t contribute to a guaranteed lifetime income investment option say that their biggest barriers stem from a lack of knowledge.
“As employees are setting goals for the new year, plan sponsors have an opportunity to explore solutions that help their female participants — and all participants — retire on time with confidence, such as guaranteed lifetime income investment options,” continued Dunlap. “However, in addition to considering their investment option line-up, our survey reveals that plan sponsors must also include educational offerings to ensure participants have the tools they need to address lack of knowledge and confidence.”
View an infographic of the survey data.
Nationwide offers a list of considerations to help plan sponsors, consultants and advisors get conversations about in-plan guarantees started, as well as additional resources for the small business 401(k) market and institutional/government market.
Nationwide Retirement Solutions administers nearly 34,000 retirement plans, protecting more than $173.9 billion in participant assets, and helping secure financial futures for more than 2.6 million participants in the governmental 457, corporate 401(k) and not-for-profit 403(b) markets. Nationwide is committed to serving the retirement industry by doing the right thing at the right time through better participant experiences, administrative simplicity and values that translate to service.
Edelman Data and Intelligence (DxI) conducted the online survey on behalf of Nationwide July 19-August 4, 2021. Respondents included:
- 500 company plan sponsor, including business executives, business owners, human resources professionals, and financial management professionals who are full-time workers at U.S. businesses with at least 10 full-time employees. They must also be decision-makers for company retirement plans including 401(k), 403(b), or 457(b) plans.
- 300 financial advisors or consultants who advise at least one plan sponsor on investment decisions, financial planning, and options.
- 1,000 plan participants 45+ years of age who work full-time and have access to a 401(k), 403(b), or 457(b) plan through their employer.
As a member in good standing with The Insights Association as well as ESOMAR Edelman Data and Intelligence conducts all research in accordance with local, national and international laws as well as in line with all Market Research Standards and Guidelines.
Nationwide, a Fortune 100 company based in Columbus, Ohio, is one of the largest and strongest diversified insurance and financial services organizations in the United States. Nationwide is rated A+ by both A.M. Best and Standard & Poor’s. An industry leader in driving customer-focused innovation, Nationwide provides a full range of insurance and financial services products including auto, business, homeowners, farm and life insurance; public and private sector retirement plans, annuities and mutual funds; excess & surplus, specialty and surety; pet, motorcycle and boat insurance. For more information, visit www.nationwide.com. Follow us on Facebook and Twitter.
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