LaVigne noted that the pandemic’s impact, financially speaking, has been remarkably different from the Great Recession. While both events caused waves of job losses, the market decline associated with the Great Recession was prolonged and the recovery took many years. The market recovery in the pandemic, meanwhile, occurred over a matter of months.
This year, 43% of respondents said that they were unable to put anything away for retirement, up from 37% last year, and 42% felt like they were too far behind on their retirement goals to catch up, up from 31% last year.
LaVigne believed the solution to growing retirement stress lies in financial wellness programs.
“Saving, even incrementally, in a workplace retirement plan could be the difference between success in retirement and having to put it off for a much longer period of time, and the only way to get that message across is through education by employers,” he said.
The 2021 Retirement Risk Readiness Study also found concerning responses around early retirement. The researchers divided the study into three cohorts: pre-retirees, those 10 years or more from retirement; near retirees, those within 10 years of retirement; and those who were already retired.
In the most recent study, 70% of non-retirees expected to work at least part-time in retirement, up from 65% in last year’s study. Yet more than two-thirds of the retired respondents, 68%, said that they had to leave the workforce earlier than expected—up from 50% in last year’s study. Health-care issues eclipsed unexpected job loss as the largest factor causing involuntary early retirement (33% versus 22%), a near reversal of last year’s numbers (25% due to health care versus 34% due to job loss).
Furthermore, only 6% of the retirees among this year’s respondents reported being able to work part-time in retirement.
The Retirement Risk Readiness Study was conducted via an online survey, fielded in December, among a nationally representative sample of 1,000 individuals age 25 and over with annual household incomes of at least $50,000 if single, $75,000 if married or partnered, or investable assets of at least $150,000.