2017 Planning & Progress Study

Transcription

1 The Northwestern Mutual Life Insurance Company Milwaukee, WI 2017 Planning & Progress Study Longevity Northwestern Mutual is the marketing name for The Northwestern Mutual Life Insurance Company (NM), Milwaukee, WI and its subsidiaries.

2 Background The 2017 Planning & Progress Study seeks to provide unique insights into U.S. adults attitudes and behaviors toward money, financial decisionmaking, and the broader landscape issues impacting people s long-term financial security. The study is based on an online survey of 2,749 U.S. adults conducted from February 14-22, 2017 (2,117 interviews with U.S. adults age 18+ in the General Population and an oversample of 632 interviews with U.S. Millennials age 18-34). Data were weighted to be representative of the U.S. population (age 18+) based on Census targets for education, age/gender, race/ethnicity, region and household income. 2

3 Healthcare Costs are a Key Concern for Americans Healthcare costs emerged as the leading obstacle to financial security in retirement for the second year in a row, spiking even higher than Healthcare costs 58% Lack of savings 44% Social Security uncertainty Lack of planning Washington Volatile markets Global instability Losses due to bad decisions in the past Boomerang children/supporting adult children Becoming a caregiver for a parent Other 31% 26% 26% 18% 15% 10% 7% 1% Healthcare Costs 2017 = 58% 2016 = 45% BASE: ALL QUALIFIED RESPONDENTS Gen Pop: (n=2117) Q1575. Besides the economy, what are the greatest obstacles to achieving financial security in retirement? 3

4 Americans also have Concerns about the Continued Existence of Social Security Only 2 in 10 Americans believe it s extremely likely that Social Security will be available when they retire. Women proved to be less optimistic than men even though they are more likely to expect to rely on Social Security as their only or primary source of income in retirement. Net (Only/ Primary) 34% 30% 38% Extremely likely Somewhat likely 20% 39% 26% 38% 40% My only source of income My primary source of income 10% 24% 9% 11% 21% 27% Not at all likely 17% 19% A source of income but not the primary source 53% 58% 49% I am already retired 24% 22% 27% I will not rely on Social Security at all 2017 Male Female 2017 Male Female Q1565. In your opinion, what is the likelihood that Social Security will be available to you when you retire? BASE: THOSE CURRENTLY NOT RETIRED - Gen Pop: (n=1520) QPAW7a. Assuming Social Security is still available, how much do you think Social Security will contribute to your retirement income? 4

5 Despite these Concerns, Fewer Americans Expect to Outlive their Retirement Savings This year, 62% of Americans expect to outlive their savings, down from 69% in More than 4 in 10 (43%) believe there is better than a 25% chance they will outlive their retirement savings. 0% 1-25% 26-50% 51-75% 76-99% 100% Don t know 6% 6% 17% 11% 19% 19% 16% 11% 21% 20% Net: Some Chance of Outliving Savings = 62% = 69% BASE: ALL QUALIFIED RESPONDENTS - Gen Pop: (2017 n=2117; 2016 n=2026) Q1645. In your opinion, what is the likelihood that you could outlive your savings? 5

6 And the Outliving Retirement Savings is a Source of Stress 7 in 10 Americans experience some level of anxiety around the prospect of outliving their retirement savings. Has Anxiety (Net) 74% 15% 25% High Moderate Low 34% Outliving retirement savings QFA1. What level of anxiety do you experience as a result of each of the following? 6

7 Fears about Outliving Retirement Savings May Stem from Gaps in Saving Less than one third of Americans believe they excel at contributing to retirement savings. Paying off credit/debt Building a strong credit history Contributing to retirement savings Being a disciplined planner (consistent and attentive to financial affairs) Starting to save early Investing wisely Managing risk wisely None/No financial best practices 47% 40% 31% 24% 22% 17% 20% QFF2. What commonly accepted financial best practices do you excel at? Please select up to 3. 7

8 Moreover, Americans have Broader Concerns About Financial Security Overall Less than half of Americans feel very financially secure and two in 10 Americans expect to feel less financially secure over the next 12 months. Current Feeling of Financial Security Change in Financial Security Over Next 12 Months Very Secure (7-10) 47% 9% Secure (5/6) Not Secure (1-4) 25% 28% Q1075. If financial security is defined as a feeling of confidence that you will achieve the financial goals you have for yourself or your family through the actions you are currently taking, how financially secure do you feel right now? Use a 1 to 10 scale where 1 means not at all financially secure and 10 means completely financially secure. 29% 36% 5% 8% Not Sure Much less secure Somewhat less secure No change in financial security Somewhat more secure Much more secure QAR7. How much do you expect your own financial security to change over the next 12 months? Will you be...? 8