Data & Research July 20, 2010

Study Indicates Financial Performance Declines for Older Adults

A new study suggests individuals make the most effective financial decisions in middle age.

Reported by

The Center for Retirement Research at Boston College analyzed 10 different financial transactions among various age cohorts and found middle-age adults make fewer financial mistakes than younger or older adults. For each transaction studied, the Center estimated the point in the life span at which financial mistakes are minimized, and the mean age was 53.3 years.  

In an Issue Brief the Center said its findings raise a potential concern as the retirement system has shifted more decisions to individuals. It suggested a range of possible policy responses to help older individuals more effectively manage their finances from improved disclosure of financial products to stricter regulatory review.  

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However, the researchers said they are skeptical that improved disclosure will be effective in improving financial choices. The study found that even for cognitively healthy popula tions, additional disclosure and consumer educa tion make surprisingly little difference in financial choices.  

The Brief suggested that instead of primarily targeting individual investors, regulations could instead target the financial prod ucts themselves. One such regime would mimic the regulatory model currently used for nutritional supplements: new financial products would be al lowed in the market without specific formal approval in advance but would be monitored for adverse ef fects. An alternative approach would require that new financial products obtain explicit regulatory approval before being marketed.  

The Issue Brief is here.
Products July 20, 2010

Guardian Announces Employee Benefit Resource Center

The Guardian Life Insurance Company of America has announced the launch of its new online resource center for employee benefits.

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The new Web site helps employers and brokers maximize employee benefits offerings by making information about industry trends, insights into perceptions and behavior, and real-world benefits strategies accessible to apply to workplace programs. The resource center will also offer tools and tips to assist consumers as they make decisions about protection plans offered by their companies.   

According to a press release, features of www.aboutemployeebenefits.com include: 

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  • Proprietary Research Reports – Based on market research with benefit decisionmakers and consumers, a series of reports that reveal insights and trends to watch to help make benefits programs more effective. 
  • Legislative Updates – Information about regulations impacting the employee benefits industry, including the Patient Protection and Affordable Care Act (PPACA). 
  • Case Studies – Strategies brokers & employers implemented for benefits enrollment, communications and helping employees return to work after a disability. 
  • Interactive Tools & Videos, including a tool for calculating a person’s chance of becoming disabled, to help employees understand what their personal protection needs are. 
  • Tips for making the most of employee benefits, including a quiz and downloadable tips sheets. 

“Making the right decisions is critical, but this can be difficult if you don’t have the information and tools you need. Our online resource center simplifies what’s happening in employee benefits so that people — whether they’re a broker, an employer offering employee benefits or an employee enrolling in them — can access what they need to make the right benefits decisions without becoming overwhelmed,” said Elena Wu, Group Worksite & Marketing Officer, Guardian, in the announcement. 

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