Financial pain of pandemic may force 25 percent of workforce to delay retirement
And one in four respondents say their finances have worsened over the past six months, according to a new Willis Towers Watson survey.
One-fourth of American employees expect to delay retirement because of the impact of the pandemic on their finances, a survey by Willis Towers Watson found.
The 2020 Global Benefits Attitudes Survey found the percentage of employees living paycheck to paycheck during the pandemic has remained steady at 37 percent, roughly the same as in 2019. However, one in four respondents say their finances have worsened over the past six months.
Nearly four in 10 employees have been unable to pay bills, are carrying over interest charges for a sustained period or have had to borrow money from family and friends to make ends meet during the pandemic.
“The pandemic is clearly shining a light on the precarious financial state of many employees,” said Shane Bartling, senior director, retirement, for Willis Towers Watson. “While some employees are spending less and saving more, a disturbingly high portion are being forced to tap into retirement savings to get by. Yet the news is not all gloomy, as some employees, including lower-income wage earners, say their finances are improving.”
One in four employees aged 50 or older expect to retire later than planned, with more than one-third of older employees planning to retire at age 70 or older.
Not surprisingly, financially stressed employees are more likely to delay retirement as a result of the pandemic, with 50 percent of all employees who are living paycheck to paycheck expecting to do so. Moreover, nearly a third of employees aged 50 or older say they will need to save more for their retirement.
Employees also said they want greater long-term financial security, notably through a more generous retirement program, and are looking to their employers for help. More than half of respondents cited saving for retirement as the number one area in which they want help from their employer.
“The link between financial stress and employee wellbeing, particularly physical and mental health, is no secret,” said Steve Nyce, senior economist for Willis Towers Watson.
“The opportunity for employers to play a critical role in helping employees improve their financial wellbeing and retirement readiness remains great. Investing in tools and resources, and educating and encouraging employees to use them, can go a long way toward reducing employee financial stress and boosting healthy outcomes and worker productivity.”
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