Public Sector Workers Less Likely Than Private Employees to Seek Financial Advice
MissionSquare research found public sector employees are less likely to work with financial professionals and more likely to rely on friends and family for guidance.
Public and private sector employees may face similar retirement planning decisions, but newly released research from the MissionSquare Research Institute suggests public workers are significantly less likely to seek professional financial guidance.
In its report, “How to Help Retirement Plan Participants Make Optimal Financial Decisions: Evidence From Public and Private Sector Employee Behaviors,” MissionSquare found substantial differences in how employees seek financial advice. Among defined benefit plan participants, 46% of public sector workers reported working with a financial professional, compared with 70% of private sector workers.
Less Help From the Pros
Survey participants were segmented into one of six categories based on their sector (public or private) and the type of retirement plan in which they participated (defined benefit only, defined contribution only, or both DB and DC).
The report was co-authored by Zhikun Liu, head of the MissionSquare Institute; David Blanchett, head of retirement research at Prudential Financial; and Gerald Young, a senior researcher at the MissionSquare Institute. It found public sector employees were more likely than private sector employees to rely on family members and friends as sources of financial information, rather than seeking out professional advisers.
“At the same time, many public sector workers report lower confidence in making investment and retirement-planning decisions,” Liu wrote in an email to PLANADVISE. “The implication for advisers is that success may require not only providing information, but also building confidence and helping participants navigate complex financial decisions throughout their careers.”
Compared with private sector employees, workers in the public sector participating in DC plans were 10.9 percentage points more likely to trust family or friends as a source of financial advice and 8.9 percentage points less likely to trust a financial adviser or planner, according to the report.
MissionSquare also found differences in investment decisionmaking. When asked which investment option they selected upon enrolling in a DC plan, 31% of private sector workers with only a DC plan and 41% of workers participating in both DC and DB plans said they chose their own investments. That compared with 23% and 34%, respectively, among public sector workers.
and advisers can help by making education and advice more accessible and [by] offering solutions such as one-on-one consultations, retirement-readiness programs and opportunities to connect directly with financial professionals,” Liu wrote. “Organizations could also consider embedding guidance into key participant touchpoints.”
Public sector employees also demonstrated higher levels of uncertainty about investment decisions. Among DC-only participants, 42% of public sector workers indicated they did not know the investment allocation in their retirement account, compared with 23% of private sector employees, according to the report.
Pensions’ Role
The report suggested that the advice gap may be partly related to public sector workers’ greater reliance on, and access to, traditional pensions. Public employees with DB plans expected pensions to cover a larger share of retirement expenses than private sector workers and reported higher anticipated monthly pension benefits. Workers expecting a significant portion of retirement income from a pension may reasonably approach savings, investment risk and retirement income planning differently than participants who expect to rely primarily on DC account balances.
“Workers who expect a significant portion of retirement income to come from a pension may feel less urgency to seek outside guidance while they are accumulating assets,” wrote Liu. “The key takeaway is that access to guidance remains important, even for workers who expect to receive pension income in retirement, because they still face important decisions regarding supplemental savings, investing, Social Security claiming strategies, and retirement income planning.”
The MissionSquare Research Institute and Greenwald Research surveyed 2,000 full-time public and private sector employees in December 2025.