Data & Research April 15, 2015

Gen X More Worried About Retirement than Boomers

Members of the younger generation express more concern about retirement specifics, compared to their elder counterparts.
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When it comes to retirement preparation and investing, members of Generation X (ages 35 to 49) tend to be more worried than Baby Boomers (ages 50 to 68), a PNC Financial Services Group survey finds.

Three quarters (73%) of Generation Xers agreed with the statement “I worry that my savings may not hold out for as long as I live,” as opposed to 55% of Boomers. Eighty-four percent of all survey respondents fear that health care costs will be too expensive in retirement, topping the list of all concerns among respondents. Generation X is slightly more worried than boomers (89% vs. 83%).

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The survey showed that while only one in seven (15%) survey respondents are still coping with the effects of the Great Recession, seven out of 10 changed their financial behavior as a result. A majority of Gen X (51%) say they are saving more for retirement, compared to 37% of Boomers.

In PNC’s survey of 1,017 adults with investable assets of at least $50,000, 65% of Generation Xers responded “I believe I am solely responsible for my retirement (no Social Security, employer pension, inheritance, etc.),” versus 45% of Boomers. Generation X expects to need an average of $1.5 million for retirement while Baby Boomers’ average expectation is slightly lower at $1.3 million. However three-quarters (74%) of Boomers have yet to reach the $1 million milestone.

Still, respondents expect Social Security to be there for them. Ninety-four percent of all survey respondents agreed “I have earned my Social Security through paying Social Security taxes and therefore it is owed to me.”

The survey also found nearly all (95%) respondents said “it (is/was) very important to me to be able to retire when I (choose/chose) to do so.” Generation Xers expect to retire younger at an average age of 63.6 years while Boomers expect to retire, on average, at 65.5.

Many of those surveyed know that their 401(k) or comparable plans will not be enough to get them over their retirement savings goal. On average, respondents invest 11% in their employers’ retirement plan and another 9% (on average) specifically for retirement outside of these plans. Of those who participate in a 401 (k) program at work, seven in 10 are offered an employer match, and nine in 10 say that an employer match is important to overall retirement savings.

The “Perspectives of Retirement Survey” was conducted online within the United States February 13 through 25, 2015, among a nationwide cross section of 1,017 adults ages 35 to 75, with total investable assets of at least $100,000 if age 45 or older, and at least $50,000 if ages 35 to 44.

Products April 15, 2015

MassMutual Launches New DCIO Team

With its sights set on competing in the defined contribution investment only (DCIO) market, MassMutual Retirement Services introduced a new institutional sales and operations team.
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Led by Aruna Hobbs, senior managing director and head of institutional investments, the team works to make MassMutual’s retirement-focused funds, including mutual funds and stable value products, available to more plans and participants.

“MassMutual’s mutual funds and stable value products are designed specifically to help retirement savers reach their goals and retire on their own terms,” says Elaine Sarsynski, executive vice president of retirement services and worksite insurance.

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MassMutual’s retirement products include the MassMutual RetireSMART, Select, and Premier Funds. 

“Our multimanager approach is well-suited for financial advisers and plan sponsors who are looking for diversification,” Sarsynski adds. “Additionally, these funds are available on not just our own platform, but are also on more than 20 other platforms for use by advisers and plans.”

Working alongside Hobbs, the DCIO sales team is comprised of four additional members including Johanna Vogel, managing director, national consultant relations; Paul Webb, national practice leader for adviser channels; and Rob Olszewski and John Hipsher, regional investment directors, tasked with growing MassMutual fund assets. The team is supported by a four-member operations unit.

The team will reach out to the retirement plans marketplace, Sarsynski notes, partnering with MassMutual’s regional sales and managing directors and working directly with financial advisers and consultants.

MassMutual’s retirement services division serves retirement plans, offering products and services for corporate, union, nonprofit and governmental employers’ defined benefit, defined contribution and non-qualified deferred compensation plans.

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