NEW YORK--(BUSINESS WIRE)--The role a company plays in its employees’ retirement security has shifted tremendously in recent decades, as employees take on more responsibility in the planning and saving for their retirement. Yet many Americans prefer predictability and a guarantee in their retirement planning – when asked if they would rather have their employer provide a set retirement paycheck for life or provide them with money to invest themselves, the steady paycheck wins by 58% to 42%.
This is one of the latest findings from the Role of the Company Survey commissioned by MetLife. Americans have accepted the shift in responsibility for their own retirement security, as 54% say that individuals are primarily responsible for their own retirement security, versus 27% who say companies and 19% who say government.
But employees want a partner in their retirement planning and they want their company to fulfill that role, as they were six times more likely to want companies to be more involved – not less – in providing for their retirement security in the next five to 10 years (61% vs. 9%).
While most individuals will likely have retirement savings through a combination of individual accounts, employer-sponsored solutions and Social Security, company-sponsored solutions were preferred. If given a choice to direct their dollars, company-sponsored retirement accounts were vastly preferred by three to one compared to government solutions, as 74% said they would rather set aside part of their salary in a company-sponsored retirement account versus 26% who preferred paying into Social Security. Even when asked to choose between saving on their own or paying into Social Security, going it alone was preferable by 56% to 44%.
“Employees recognize the important role their employers can play in planning for retirement,” said Roberta Rafaloff, vice president of Institutional Income Annuities at MetLife. “They want a trusted partner who can help them navigate retirement security, creating an opportunity for companies to help their employees plan and save.”
Some interesting generational differences – and similarities – exist as well. Despite being the generation closest to retirement, only 14% of Baby Boomers say they want the government to be primarily responsible for retirement security, while 24% of Millennials feel that way. There is no significant difference between Millennials’ and Boomers’ preferences for steady income in retirement – both groups equally favor a set retirement check from their employer rather than receiving money from their employer to invest on their own.
This similarity shows the recognition of the preference for a guaranteed retirement income, a paycheck in the form of a pension payment from a traditional defined benefit plan, or an annuity purchased using retirement savings from a defined contribution plan, such as a 401(k) plan. The traditional defined benefit plan is fading from the workplace and a less common offering for younger workers, while defined contribution plans are more prevalent for workers today.
Through its Employee Benefit Trends Study (EBTS), now in its 16th year, MetLife tracks employee and employer attitudes and expectations about the workplace and the workforce. The 2018 EBTS will be released April 16, 2018. The Role of the Company Survey looks at the workplace through a different lens, revealing what employees and society at large expect of corporations broadly.
MetLife’s survey on The Role of the Company was conducted in July 2017 and was fielded by ORC International, a leading business intelligence firm. The survey comprised 1,006 interviews with part-time and full-time U.S. employees, ages 21 and over. The margin of error was plus or minus 3.5%.
MetLife, Inc. (NYSE:MET), through its subsidiaries and affiliates (“MetLife”), is one of the world’s leading financial services companies, providing insurance, annuities, employee benefits and asset management to help its individual and institutional customers navigate their changing world. Founded in 1868, MetLife has operations in more than 40 countries and holds leading market positions in the United States, Japan, Latin America, Asia, Europe and the Middle East. For more information, visit www.metlife.com.