A new survey indicates that individuals’ thinking around retirement has changed due to the COVID-19 pandemic. While older Americans plan to stay in the workforce longer due to the pandemic, some young professionals plan to retire earlier.
The study was conducted by The Harris Poll on behalf of Northwestern Mutual. Of those surveyed, 35% said they have changed their retirement plans, with 24% planning to retire later than expected, and 11% planning to retire earlier.
Those who plan to retire later report contributing factors which include wanting to save more money, concerns over rising healthcare costs, and financial responsibility for family and loved ones. Some 39% plan to push retirement back by three to five years, while others (35%) plan to extend their working lives more than 10 years.
By contrast, a majority of young people surveyed - Gen Z (59.4%) and millennials (59.5%) - plan to retire earlier than they previously planned. They cite wanting to focus on family and loved ones, hobbies, and personal growth, as well as a change in their work situation, such as being laid off. Of these, 48% plan to move up their retirement timeline by three to five years.
While survey participants report higher retirement savings than last year, 43% anticipate outliving their savings. To alleviate this financial pressure, they are taking steps such as increasing savings, consulting financial advisors, going over options with family members, and investing.
Many plan to fund their retirements with 401(k) plans, Social Security, and personal savings or investments. However, a significant portion (43%) believe Social Security may disappear within their lifetimes.