The annual Mercer Workplace Survey conducted in May and June found only 39% of participants say they will have enough money to pay for health care in retirement—down from 41% last year and 53% in Mercer’s May 2004 survey. Less than one-third (32%) of those surveyed said in retirement they will live as well as or better than when working, according to a Mercer news release.
Expectations have also lowered for being able to leave money to family members or charities (23%), being in a position to travel extensively during retirement (17%), and being able to help younger family members with tuition or housing expenses (17%).
Despite the lower expectations, the survey finds participants are still committed to saving for retirement. Seventy-one percent of respondents said saving for retirement remains a major financial objective. In addition, the percentage of those who plan to continue contributing to their savings plans at their current rate remains virtually unchanged from the past two years, according to the news release.
The survey was conducted among 2,204 active 401(k) participants who also participate in their employer’s health plan. The survey findings were supported by Mercer participant transaction activity during the current market volatility. Mercer said it saw a marked increase in call volume and Web site usage in October, but loan requests remained relatively steady and actual changes to individual retirement plans and allocations were relatively small for the year ending November 30.
Looking at the bigger financial picture, 401(k) participants surveyed ranked keeping up with monthly expenses (19%) as their biggest financial worry for the second consecutive year, while 15% of respondents reported that saving enough for retirement worries them most.
One highlight from the survey indicated the increasing emphasis on employee education, especially in the area of health and benefit programs, is improving the employee benefits experience. Ease of understanding of employee health plans was up almost 10 points over last year, followed by ease of making changes to the plan, and simplicity of enrollment.