Even before the COVID-19 pandemic, many retirement-age Americans were concerned about not having enough saved to actually be able to retire. But due to the COVID-19 pandemic, people with retirement on the horizon are not the only ones worried.

Although all the long-term implications of the coronavirus pandemic and recession on retirement security have yet to be fully realized, the financial vulnerabilities among workers across all generations are becoming clear, says a recent study. But it also found that employers can significantly help their employees, no matter how close or far they are to retirement, prepare and meet certain savings goals.

The results from the study, "Amid COVID-19: The Outlook of Three Generations," which examined the retirement outlook of millennials, Generation X, and baby boomers, came out of the findings of the 20th Annual Transamerica Retirement Survey. This survey polled 5,277 U.S. residents over the age of 18 working full or part-time for a for-profit company from Nov. 6 to Dec. 27, 2019. A supplemental online survey was then conducted from April 16-20, 2020 of 2,030 U.S. adults who were laid off or furloughed as a result of the coronavirus pandemic.

How employers can help

The study points out that employer-sponsored retirement benefits, such as 401(k) programs, have proven to be highly effective at encouraging savings. In addition, most employees being offered these services participate and rely on these programs. In fact, the study showed that 85% of workers polled "highly value" retirement benefits and 80% said that retirement benefits offered by a prospective employer is a "major factor in their decision whether to accept an offer."

The participation in retirement plans is also very high. The study showed that when offered a plan, three in four participate in employer sponsored 401(k)s or similar plans. But it also indicated there could be room for growth in participation by adding features like automatic enrollment and automatic escalation.

In addition, the poll indicated that a majority of U.S. workers in retirement plans take advantage of professionally managed offerings, and want more easy digestible and understood retirement education and advice.

The concern lies in the data points that shows even though there are a high number of workers that want these tools for retirement, almost one in four workers are not being offered any retirement benefits. And those employers that do provide the benefit to employees do little to facilitate the transition of an employee into their retirement.

In addition, health and welfare benefits can also enhance workers' financial security. These benefits can provide insurance protections and mitigate out-of-pocket health care costs. But while most workers also believe these benefits are important, a significant gap exists that spans all three generations between the number of workers who believe in their importance and the percentage who are offered these services by their employers. As the study point out, this represents an opportunity for employers to increase the competitiveness of their benefits packages, while also helping their employees achieve greater long-term financial security.

Heather D. Nevitt is the Editor-in-Chief of Corporate Counsel, Inside Counsel and Global Leaders in Law.

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Workers value retirement plans, but employers could do more

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