While most retirement plan participants find guaranteed income
appealing, the farther the horizon to retirement, the greater the
attraction, study from The Hartford shows
A new study from The Hartford shows that while many American workers
find it appealing to have a guaranteed income in retirement, the younger
the employee, the greater the attraction.
"Our research shows that Americans, regardless of age, want the ability
to create a guaranteed income for their retirement as traditional
pension plans vanish from the scene," said Patricia Harris, assistant
vice president of product management for The Hartford's Retirement Plans
Group. "Surprisingly, we also found that the farther retirement appears
on the horizon, the greater the appeal of guaranteed income."
The Hartford's Guaranteed Retirement Income study finds that three out
of five Americans (64 percent) say their employer's 401(k) or other
retirement plan does not allow them to turn their savings into
guaranteed income in retirement or they are unsure if it does.
Overwhelmingly, those respondents say they would welcome the opportunity:
Overall, 87 percent of respondents of all ages say they find it "very"
or "somewhat" appealing to be able to turn at least a portion of their
retirement savings into a guaranteed income.
95 percent of workers younger than 30 say the same, the highest of any
The same sentiment was expressed by 90 percent of those ages 30-39, 89
percent of ages 40-49, 88 percent of ages 50-59, and 77 percent of age
60 and older.
"Although the economy and the financial markets are on the mend, many
younger employees are seeking sources of greater long-term financial
security," Harris observed. "Few younger workers have access to
traditional pension plans and many wonder whether Social Security will
continue in its current form. They are clearly saying they want the
ability to create a guaranteed income for themselves in retirement."
The Hartford's study, which surveyed 2,500 Americans ages 18 and older
earlier this spring, was conducted following the introduction of The
Hartford Lifetime Income® (HLI), an investment option that
allows 401(k) participants to use their savings to create a pension-like
income in retirement.
"Overall, the study confirms our own experience since January in
offering Hartford Lifetime Income through employer-sponsored retirement
plans across the country," said Harris, the actuary who designed the
patented investment option. "We see broad acceptance of lifetime income
among 401(k) participants of all ages, even younger workers who are
decades from retiring."
However, The Hartford's study did pinpoint some differences related to
gender and income. For instance, women (89 percent) have a greater
preference for guaranteed retirement income than men (84 percent).
Household income also impacts the level of appeal, although not in a
linear fashion. The concept of guaranteed retirement income appeals most
to those with a combined annual household income of $50,000-$74,000. A
total of 92 percent in that demographic would like their employer to
offer a guaranteed income option compared to 87 percent of those earning
$30,000-$49,000, 86 percent earning less than $30,000, and 84 percent
earning $75,000 or more.
"As a leading provider of retirement plans, The Hartford is acutely
aware of the need for Americans to not only save for retirement but to
use a portion of their savings to create a guaranteed retirement income
that they cannot outlive," Harris said. "We recommend that everyone
should ensure they have enough guaranteed income from a variety of
sources, including Social Security, a pension if they have one and
retirement savings, to at least cover their basic living expenses when
About The Hartford
The Hartford Financial Services Group Inc. (NYSE: HIG) is a leading
provider of insurance and wealth management services for millions of
consumers and businesses worldwide. The Hartford is consistently
recognized for its superior service, its sustainability efforts and as
one of the world's most ethical companies. More information on the
company and its financial performance is available at www.thehartford.com.
Join us on Facebook at www.facebook.com/TheHartford.
Follow us on Twitter at www.twitter.com/TheHartford.
Some of the statements in this release may be considered forward-looking
statements as defined in the Private Securities Litigation Reform Act of
1995. We caution investors that these forward-looking statements are not
guarantees of future performance, and actual results may differ
materially. Investors should consider the important risks and
uncertainties that may cause actual results to differ. These important
risks and uncertainties include those discussed in our Quarterly Reports
on Form 10-Q, our 2011 Annual Report on Form 10-K and the other filings
we make with the Securities and Exchange Commission. We assume no
obligation to update this release, which speaks as of the date issued.
Hartford Lifetime Income and the related technology and processes are
patented under U.S. Patent Nos. 7,805,352B, 7,840,469 B2, 7,853,509 B2
Hartford Lifetime Income is subject to state and broker-dealer
Guarantees in the Hartford Lifetime Income are based on the
claims-paying ability of The Hartford Life Insurance Company.
RPG # 110499
The Hartford Financial Services Group Inc.