More than one-third (37%) of Americans say income for life is what they want most from a workplace retirement plan, according to a recent survey from TIAA.
They prize lifetime income over options such as employer contributions (19%) or investment choices with strong performance (10%).
However, the survey also found people are more likely to agree with their spouse or partner on daily expenses than on retirement savings. Eighty-two percent agree on how much to spend on children (school gear, activities, etc.); 77% agree on how often to go out to dinner; and 75% agree on how much to spend on vacation, David Ray, senior managing director, head of institutional retirement plan sales at TIAA, in Dallas, tells PLANSPONSOR.
When it comes to retirement, 74% agree on how much to save.
The good news, though, is that 59% who are married or in a relationship say they would be willing to work through their differences to reach a compromise, which can help them develop a solid strategy for retirement.
Ray says the survey reveals a need for more early engagement with couples to speak about finances. According to Ray, plan sponsors can make a big impact here. “Employees have a lot of confidence in employers, so plan sponsors can encourage conversations with spouses and partners, and for employees to start early,” he says. “Plan sponsors can even suggest questions couples can ask, such as what do they want to achieve after working, what income will they need?”
Couples need to set financial priorities, Ray notes, adding that plans with regard to children have a big effect on long-term and short-term goals. A positive draw for employees would be for plan sponsors to offer access to advice or education.
“We found the on-site presence of an adviser or planner to sit with participants and spouses is preferred over a group setting. Couples want privacy to discuss these issues,” Ray says. “If an employer can support that, it creates employee satisfaction and improves retirement readiness for employees. Couples need to put their financial and personal life in order, and that involves emotions.”
Ray adds that accessing retirement readiness information can help plan participants and their spouses feel more confident and develop a plan. “Without that knowledge, they are just guessing,” he says.
The survey was conducted among a random sample of 1,022 adults, ages 18 and older living in the U.S., from January 12 through 16, for TIAA.