With widespread financial instability affecting millions of Americans during the coronavirus crisis, many have turned to their family members for financial assistance and support.
Financial services provider CNO Financial Group and its consumer research program, the Center for a Secure Retirement, found in a new survey that 41% of middle-income baby boomers have begun financially supporting other family members during the pandemic — and this decision is affecting their own retirement plans as a result.
COVID-19 pandemic compels middle-income baby boomers to reassess their retirement plans and priorities
A previous survey from Northwestern Mutual found that nearly 6 in 10 (58%) Americans are currently in "financial recovery mode" due to the pandemic.
CNO Financial Group's findings suggest that many have leaned on their older, more established family members as a support system during this time. However, this move has also forced many baby boomers to reassess their own financial situation.
In fact, the survey shows that almost all (98%) of respondents who have begun supporting their family members have seen this decision impact their own plans for the future. Specifically, these changes include:
- Not being able to save as much for retirement (75%)
- Delaying moving plans (65%)
- Reevaluating finances and expenses for retirement (51%)
Another 52% of boomers who have not yet retired reported a need to completely reevaluate their retirement plan in light of these new developments, as their top concern now has become how much they need to retire comfortably (63%).
The CNO report also shines a light on how the retirement priorities of middle-income boomers have changed. Before the pandemic, the top concern for respondents was maintaining their financial stability and independence in their golden years (56%).
However, boomers have since reshuffled their priorities in retirement, with their new top five being:
- Spending time with family and grandchildren (43%)
- Maintaining financial stability and independence (35%)
- Maintaining an active lifestyle (34%)
- Being able to travel (30%)
- Living close to family and friends (25%)
Sentiments toward retirement saving differ between age groups and genders
The CNO survey also revealed marked differences in respondent sentiments about the amount they're saving for retirement. For instance, the company found that over twice as many women than men see having enough money to last throughout their retirement as a big concern (55% versus 23%).
Still, 61% of women were able to save more money than expected during the COVID-19 pandemic, compared to just 26% of men.
Similar findings were reported between age groups, with 48% of younger baby boomers between the ages of 57 to 70 almost twice as likely to save more money than their counterparts ages 71-75 (27%).
There is some good news, though. Although a separate survey from Schwab Retirement Plan Services found that 23% of 401(k) plan participants report delaying their retirement plans because of the pandemic, 53% agree that they are still "very likely" to achieve their retirement goals.
Methodology: OnePoll conducted this survey in April 2021 on behalf of CNO Financial Group and the Center for a Secure Retirement. The survey sample included 2,567 middle-income baby boomers (ages 57-75) with an annual income between $30,000-$100,000 and with less than $1 million in investable assets.