Data and Research

PANC 2016: The John Hancock Financial Stress Survey

Americans are overwhelmed by financial stress,  and plan sponsors and advisers can help reduce it.

By Lee Barney | September 14, 2016
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Americans are overwhelmed by financial stress—and they are not taking any steps to alleviate this problem, according to the third annual John Hancock Retirement plan Services (JHRPS) survey. It is incumbent on retirement plan sponsors and plan advisers to help participants overcome this through automatic features—including automatically enrolling them into emergency savings accounts, along with engaging them and educating them, said Patrick Murphy, president of JPRPS, speaking at the 2016 PLANADVISER National Conference.

Murphy said, “We launched this survey in 2013 because, instead of guessing why people were not taking action, we wanted to ask participants why they aren’t doing what they need to do, and now we have to do something with this information.”

While the situation overall isn’t positive, “there have been some signs of improvement on the road to retirement readiness,” he said. Seventy-nine percent said their financial stress has increased over the past three years—but 22% said it has decreased. “It is improving, but it is not gone,” Murphy said. “Retirement is still people’s number one priority. People need a nudge, through automatic enrollment and escalation, but we also need to provide advice for the big picture, either with robo advisers or in person.”

Fifty-four percent said their personal financial situation is better than two years ago. In 2014, 66% felt financial stress, and in 2016, that ticked down to 63%. In 2014, 69% said their financial stress was affecting them physically and/or psychologically, but this year, that’s declined to 59%, Murphy said.

NEXT: Financial stress among various demographic groups