Workers Willing to Pay More for Guaranteed Retirement Benefits

A Towers Watson survey found that a majority of workers (56%) would be willing to pay a higher amount from their paycheck to ensure a guaranteed retirement benefit.

 

In addition, 54% of workers polled said they would be willing to pay a higher amount from their paycheck to ensure access to health care benefits if they retire before they are eligible for Medicare.   

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Four in 10 of the nearly 9,100 U.S. workers surveyed are planning to delay their retirement, according to a press release. Older workers and those in poor health comprise the largest percentage of employees planning to delay retirement. In particular, 45% of employees in poor health plan to postpone retirement.   

When asked why they are choosing to retire later, more than two-thirds (68%) of older workers said to keep their health care coverage, while 62% cited the higher cost of health care. Six in 10 older workers (61%) blamed the decline in the value of their 401(k) plan.  

The survey also found more than one-third (37%) of employees with a 401(k) plan intend to increase contributions over the next 12 months, while one-half (51%) plan to keep contributions at the same level. Nearly half (47%) of respondents say they are comfortable making their own retirement investment decisions.   

More than six in ten respondents (63%) are actively paying off debts to improve their financial situation, nearly double the number (33%) in early 2009, the press release said. More than half (54%) are cutting back on daily spending, while roughly one-third (34%) are increasing monthly savings, compared to only 19% in early 2009.   

Older workers (age 50 and above) have reduced savings needs the most over the past 15 months, while adopting more conservative saving and investment strategies.

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