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The economic unrest being caused by the ongoing COVID-19 pandemic should not stop employers from helping workers with their retirement planning, according to a new survey conducted by a multinational insurance and investment company.
The 2020 Aegon Retirement Readiness survey recommends that employers create retirement, investment and insurance options for their workers, including matching contributions to retirement plans and offering life and disability insurance.
"Today, individuals are expected to save and invest for an increasing proportion of their retirement income. However, many people find themselves ill-equipped to do so and will likely face further financial pressures in the wake of COVID-19," said Mike Mansfield, the program director for the Aegon Center for Longevity and Retirement, in a press release.
Mansfield added that the survey confirms "that more support is needed for individuals to adequately harness their true savings potential to adequately prepare for their financial future."
Aegon surveyed 14,400 workers and 1,600 retirees across 15 countries, including the United States. The online survey was conducted between Jan. 28 and Feb. 24, 2020, the same period of time the world began feeling the effects of the novel coronavirus.
Sixty-five percent of survey respondents, for instance, found the idea of being automatically enrolled in a retirement program upon beginning a new job to be appealing. But the report noted that support for this idea varies widely by country — respondents in India and Brazil found this idea more appealing than their counterparts in Japan and Hungary.
The report's recommendations are geared toward expanding the number of options and the amount of information available to workers. For instance, employers should extend options for retirement saving to all of their employees, including part-time ones and contractors.
Aegon's recommendations also took aim at governments. The multinational insurance company called for government measures that would "ensure sustainability of social security benefits…to accommodate longer lifespans and the relative aging demographics."
Among the measures Aegon explicitly mentioned in its report included increasing taxes to fund government-backed retirement programs; increasing the eligibility age for receiving those benefits; or reducing benefits altogether.
Additionally, Aegon also called for governments to provide access to affordable health care; tax incentives to encourage retirement saving; and require schools to teach students to be financial and health literate.
The report was authored by Aegon and the Aegon Center for Longevity and Retirement, as well as the Transamerica Center for Retirement Studies, a nonprofit subsidiary of Aegon's U.S. branch; Instituto de Longevidade Mongeral Aegon in Brazil, a nonprofit subsidiary of a joint venture between Aegon and a Brazilian life insurance company; and Cicero/AMO, a market research firm.
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David Thomas
I'm a reporter covering the business of law, with an emphasis on national and global law firms for The American Lawyer, Law.com and other ALM publications.
