Investors Support Social Security Privatization

June 4, 2001 ( -Some form of Social Security privatization is supported by 43% of US investors polled in a survey.

Of the remaining respondents:

  • over a third opposed privatization
  • 22% were unsure.

The survey, titled Retirement Savings in an Unsettled Economy, was conducted by Putnam Investments and comprised the responses of 1,500 US citizens who hold retirement accounts.

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Generation gap

Results showed that respondents’ views on the direction of Social Security policy varied markedly across demographic divides. Specifically:

  • younger investors tended to favor privatization Investors in the 18 to 34 age group favor privatization by 43%, while 28% disagree
  • 37% of respondents, 55 and older, are for Social Security privatization while 47% are against it
  • half the male respondents favored privatization, compared to the 32% who opposed it
  • 30% of women are in favor and 40% are against it.

Sources of Income

Results also show that a 401(k) plan will be the primary source of retirement income for 28% of those polled, IRAs were noted by 16% of respondents, while Social Security was cited by 14%.

Once again, responses differed across demographic lines, with almost a quarter of the older group relying on social security, 20% citing defined benefit plans, 14% listing IRAs and only 9% mentioning 401(k)s.

In the second group, comprising respondents aged between 35 and 54, 30% cited 401(k) plans, followed by 14% who will rely on IRAs and 14% who will rely on Social Security.

Defined contribution plans came on top of the list for investors in the youngest demographic, with 38% citing 401(k) plans. Further, almost 20% cited IRAs, while only 7% listed Social Security.

– Camilla Klein