Americans Want New Pensions

Americans are highly supportive of pensions and see these plans as a way to improve retirement readiness, a survey found.

Eighty-three percent of Americans report favorable views of pensions, and 82% say those with pensions are more likely to have a secure retirement, according to a research report, “Pensions and Retirement Security 2013: A Roadmap for Policy Makers,” issued by the National Institute on Retirement Security (NIRS). In addition, 84% of survey respondents say all Americans should have access to a pension to be self-sufficient in retirement.   

Support was strong from both men and women (83% and 82%, respectively). Pensions may also play a factor in choosing an employer—if considering a new job, Americans report being nearly twice as likely to pick an employer with a pension than one with a 401(k) plan.  

Eighty-seven percent of Americans polled contend that policymakers do not understand how hard it is to save for retirement. Millennials are highly dissatisfied, at 94%. Three-fourths of Americans say a new type of pension plan described in the survey is a good idea. More than 90% would favor a new pension plan that is available to all Americans, is portable from job to job and provides a monthly check throughout retirement for those who contribute.  

Even though retirement is in the distant future, virtually all Millennials agree that the retirement system is under stress and needs repair (95%), and that lawmakers need to make retirement a higher priority (90%). They also believe that those with pensions will have a more secure retirement (89%) than those without, and 94% say the lack of pensions for Baby Boomers is creating stress for families and the economy. Millennials are especially supportive of a new pension system (84%), with 88% saying they would consider participating.

Nearly three quarters of respondents (73%) support these public employee pensions because public employees contribute to their pension from every paycheck. For police and firefighters, 86% of Americans say these employees deserve pensions given their job risks. And for teachers, 72% of Americans indicate pensions are deserved to compensate for low pay.  

The survey also found a majority of Americans (85%) continues to report concern about their retirement prospects, with more than half (55%) very concerned. Concern is higher for women than men (90% and 80%, respectively), and concern is high consistently across generational lines.  

Eighty-seven percent of respondents say the increasing number of Baby Boomers retiring without pensions and/or inadequate savings is straining families and the economy. Sixty-seven percent say it is a mistake to cut government spending in such a way as to reduce Social Security benefits for current retirees.  

The poll described a possible new type of privately run pension plan that would be available to all Americans; portable from job to job; easy for employers to administer while offering professional money management; and that would allow for a regular check that lasts through retirement. These characteristics are similar to a possible proposal by the U.S. Senate called Universal, Secure and Adaptable (USA) Retirement Funds (see “The Retirement Security Crisis and a Plan to Solve It”).  

The survey was conducted by Mathew Greenwald & Associates as a nationwide telephone interview of 800 Americans age 25 or older. The report is available here