Over half of employees plan to work during retirement: Transamerica study
Several generations of workers expect to work into retirement, due to several positive and not-so-positive reasons.
A majority of workers (57%) plan to work full-time or part-time in retirement, according to a new survey by the research team at Transamerica Center for Retirement Studies reporting trends for three age groups: baby boomers, Generation X and millennials.
Generation X scores the highest percentage of those who plan to work either full-time or part-time in retirement (58%), followed by millennials (57%) and baby boomers (54%). Among just those who plan to work full-time in retirement, baby boomers score the highest percentage (42%) when compared to the other two age groups included in the report.
The study also reports that 52% of workers across age groups plan to work past the age of 65 or don’t plan to retire, according to data studied by the Transamerica Center for Retirement Studies. Among the three age groups extracted, 68% of baby boomers expect to work past age 65 or are already doing so, followed by 53 percent of workers in Generation X and 43 percent of millennials.
One reason the majority of workers might anticipate extending their work life? The study indicates that retirement savings may not be sufficient. The estimated median retirement savings across all groups was $50,000 — with millennials on the low end, with an estimated $23,000 saved, and baby boomers on the high end, with an estimated $144,000 saved.
All age groups cited as their top two reasons for working in retirement wanting the income and continuing to be active, according to the report. Only 22% of Generation Xers, 24% of baby boomers and 26% of millennials strongly agree that they’re building a big enough nest egg for retirement.
“Workers across generations are at risk of not achieving a financially secure retirement — an issue of major concern long before the coronavirus pandemic,” said Catherine Collinson, CEO and president of Transamerica Institute, said in a May 19 news release. “Now, the negative economic effects of the pandemic are further threatening retirement savings and security.”
The survey, “Retirement Security Amid COVID-19: The Outlook of Three Generations,” polled “a nationally representative sample” of 5,277 full-time and part-time workers at for-profit companies, from November 6 to December 27, 2019, according to the Transamerica Center for Retirement Studies.
Forecasting the future: Good vibes only
Of those who plan to retire, 55% of workers surveyed said they expect their enjoyment of their life to improve. Millennials outpaced baby boomers and those in Generation X with this sentiment, with 61% of respondents in that group reporting that they expected an uptick in their life enjoyment compared with 48% of baby boomers and 51% of Generation X. (But it’s relevant to note here that the number of millennial workers polled, 2,418, nearly doubled the number of baby boomers respondents, 1,287, and was 41% higher than the 1,424 Generation X workers polled.)
Between 86% – 89% of workers across the three age groups included in the report cite one or more positive word associations with “retirement,” including the terms “freedom,” “enjoyment” and “stress-free.” Baby boomers cited the words “freedom” and “enjoyment” (59% and 60%, respectively) more often than those in generation X (57% and 52%) and millennials (55% and 50%).
Lisa Helem is the editor in chief of The National Law Journal. Contact her at lhelem@alm.com. On Twitter: @lhelemNLJ
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