COVID-19 pandemic may be the catalyst to more retirement savings
Difficult financial year has Americans pledging to seek financial advice
GREENWOOD VILLAGE, Colo., Jan. 27, 2021 — The COVID-19 pandemic and its effects on the economy had Americans tightening their belts, and it may be the catalyst that now drives them to spend less and save more.
That’s according to a new survey from Empower Retirement and Personal Capital1 that asks working and retired Americans how the coronavirus economy has affected them and their savings plans. The results show that Americans are worried about the overall economy, but they are committed to setting and reaching their financial goals.
Survey results and analysis are detailed in a research paper, "In Unchartered Waters, Savers Keep Both Hands on the Tiller."
The pandemic highlighted the importance of saving, according to the survey. When asked about their financial goals, “saving for retirement” and “paying off personal debt” topped their lists. Survey respondents said they want to spend more time planning their finances and learn more about financial strategies.
The uncertainty of the economy, even as a coronavirus vaccine rolls out, has sparked more interest in expert financial advice. Survey results show 83% of respondents said they want to minimize worrying about their finances this year, mainly through increased savings.
- 52% of respondents said they will seek more guidance when it comes to their financial strategies.
- 33% said they are more likely to work with financial professionals as opposed to 24% at the onset of the pandemic.
- 41% of survey respondents said they plan to spend less money on non-essential items.
- 38% percent plan to save more of each paycheck they receive.
“This past year has been difficult for so many Americans. Those faced with financial hardships found themselves changing or adjusting their financial plans,” said Stephen Jenks, Empower Retirement Chief Marketing Officer. “But this tough year also has inspired some workers and retirees to reexamine their financial goals and seek expert advice on the best strategies to help them achieve a secure retirement.”
The survey shows people are determined to save more and be prepared for the future, no matter what happens, and they are looking for advice on how to move forward financially in the new year.
“COVID-19 impacted every person in different and often exhaustive ways,” said Craig Birk, CFP, Chief Investment Officer at Personal Capital. “So many families suffered loss, hundreds of thousands of small businesses closed and millions of jobs vanished. For others, working remotely has had positive aspects.
“The good news is, for many, it’s not too late to turn things around. Working and retired Americans are saying they want to save early, often and aggressively.”
About Empower Retirement
Headquartered in metro Denver, Empower Retirement administers approximately $884 billion in assetsfor more than 12 million2 retirement plan participants as of December 31, 2020. It is the nation’s second-largest retirement plan recordkeeper by total participants.3 Empower serves all segments of the employer-sponsored retirement plan market: government 457 plans; small, midsize and large corporate 401(k) clients; non-profit 403 (b) entities; private-label recordkeeping clients; and IRA customers. Personal Capital, a subsidiary of Empower Retirement, is an industry-leading hybrid wealth manager. For more information please visit empower-retirement.com and connect with us on Facebook, Twitter, LinkedIn and Instagram.
About Personal Capital
Personal Capital, an Empower Company is a remote-delivery, industry-leading digital wealth management company that helps people transform their financial lives through technology and advisory services. The company’s state-of-the-art tools and technology provide investors with a complete financial picture, utilized by millions of users and tens of thousands of clients. Its registered investment advisors provide expert guidance, and customized strategies, based on a personal understanding of an investor’s financial picture and goals. Personal Capital currently manages more than $16 billion in assets (as of December 17, 2020) virtually delivered from offices across the United States. For more information, please visit personalcapital.com or connect with us on Facebook, Twitter or LinkedIn.
Monica Mendoza, Monica.Mendoza@empower-retirement.com, 719-373-2460
To learn more about how we’re empowering plan sponsors and their participants to be more engaged in their retirement plans than ever before, call us at 800-719-9914.
1 This survey was conducted by the Harris Poll for Empower Retirement and Personal Capital from November 25 to December 11, 2020. Harris surveyed 2,008 U.S. residents who were at least 18 years old. Respondents were employed or full-time retired. Results were compared with findings to earlier surveys conducted in April 2020 and from December 18 to December 30, 2019.
2 Estimated participants and total assets under administration (AUA) of Empower Retirement and MassMutual as of December 31, 2020. Information refers to the business of Great-West Life & Annuity Insurance Company and its subsidiaries, including Great-West Life & Annuity Insurance Company of New York. As of September 30, 2020, GWLA’s consolidated total AUA were $709.9B. AUA is a non-GAAP measure and does not reflect the financial stability or strength of a company. GWLA’s statutory assets total $54.8B and liabilities total $51.8B. GWLANY statutory assets total $1.69B and liabilities total $1.57B.
3 Pensions & Investments 2020 Defined Contribution Survey Ranking as of April 2020.
Online Advice and the managed account service are part of the Empower Retirement Advisory Services suite of services offered by Advised Assets Group, LLC, a registered investment adviser.
FORWARD-LOOKING STATEMENTS DISCLAIMER
Certain statements in this press release constitute forward-looking statements representing management’s current view of future events based on reasonable assumptions. These statements are not guarantees of future performance as actual results may differ depending on the development and completion of this business combination. Consider these and other factors, uncertainties and potential events carefully and do not place undue reliance on forward-looking information. Other than as specifically required by applicable law, forward-looking information as a result of new information, future events or otherwise will not be updated. RO1496851-0120
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