More workers postpone retirement
The economic situation seems to be spurring workers to postpone retirement, a new survey finds.
Forty percent of U.S. workers plan to retire later than they anticipated two years ago in the hopes of ensuring a more secure future, according to the survey from professional services company Towers Watson, which talked to almost 9,100 employees in May and June.
Many of those planning to put off retirement were older or had health problems. Forty-five percent of employees in poor health are waiting to retire; 68 percent of older workers said they would work longer to keep their health care coverage, and 62 percent cited rising health care costs. Sixty-one percent of older workers said they would stay on the job because the value of their 401(k) plans had fallen.
“The economic crisis has had a deep effect on employees’ attitudes toward retirement and especially on risk,” David Speier, a senior retirement consultant at Towers Watson, said in a release. “Despite the signs that some employees are saving more, spending less and reducing debt as the economy stabilizes, workers continue to have a fear that they won’t be able to afford retirement - and that will have significant implications on companies’ ability to plan their future work force needs.”
That also could make it difficult for younger workers looking to join the work force.
Compared with early 2009, consumers now are much more focused on paying off debt (63 percent versus 33 percent) and increasing monthly savings (34 percent versus 19 percent), the survey found. More than half are trimming daily spending, and 37 percent plan to increase 401(k) contributions during the next year.
Fifty-six percent of workers indicated that they would pay more to get a guaranteed retirement benefit, compared with 46 percent who said so in February 2009. Fifty-four percent said they would pay more from their paychecks to make sure they got health care benefits if they retired before they were eligible for Medicare.
“Interestingly, not just older employees are wary,” Speier said. “Younger workers, who generally are far less risk-averse given their retirement timeline, are also willing to forgo pay and benefits today for guaranteed and predictable benefits when they retire. This issue becomes critical as employers begin to re-evaluate their overall retirement benefit and health care strategies for the future.”
Source: Kansas City Business Journal
