7 surprising budget trends of retirement super savers
Super saver trend 1
Super savers span all income levels
$35K - $74.999
$75K - $99.999
>$100K
$35K - $74.999
$75K - $99.999
>$100K
Who is a super saver?
Super saver trend 2
Long-term commitments help them maximize savings
Super savers start early and keep at it.
The pandemic didn't change that. (Over half saved even more.)
Findings:
They began saving for retirement in their 20s.
Parents are a big influence.
Their choices feel unremarkable to them.
Super savers have a variety of motivations.
Super savers are content with the basics.
Super saver trend 3
Their savings confidence and commitment remain high
Super savers saved more during the pandemic.
Invested additional money in the market
No financial decisions or changes due to COVID-19
Increased my deferral/savings percentage
on my retirement savings account
Met with my financial professional regarding
my retirement savings and investment
Changed my investment allocation stock
to more aggressive investments
Increased the amount I'm saving in an
individual retirement account (IRA)
Invested additional money in the market
No financial decisions or changes due to COVID-19
Increased my deferral/savings percentage
on my retirement savings account
Met with my financial professional regarding
my retirement savings and investment
Changed my investment allocation stock
to more aggressive investments
Increased the amount I'm saving in an
individual retirement account (IRA)
Nearly all save for the unexpected
Super saver trend 4
Super savers are interested in more ways to invest
That may include diverse investment options in employer-sponsored retirement plans.
Super saver trend 5
Super savers expect to keep working, save more, and have a long retirement
Super saver trend 6
Gen Z already has super savers
The youngest super savers are gaining momentum.
Their pandemic changes included:
Characteristics
Use new technology (phones, computers)
Rely on apps to manage finances, and YouTube and Reddit for financial information
Prioritize adventure and travel
Shop online, do takeout
Saving motivations
Unexpected events
Early retirement
Sacrifices
Live with parents longer or have roommates
Rent vs. purchase a home
Walk, bike, use public transportation
Super saver trend 7
Almost anyone can mimic super saver behaviors
You can:
Live within or below your means.
Pay off your credit card balance monthly or don't use credit cards.
At a minimum, defer enough of your salary to receive the maximum employer match.
Defer at least 10% of your salary to an employer-sponsored retirement plan.
Increase your retirement deferral rate each year you receive a raise.
Create an emergency savings fund.
Employers can:
Stretch the match: Incentivize participants to increase their contributions.
Create immediate eligibility and vesting.
Add automatic enrollment, increase, and sweep to retirement plans.
Offer more savings options within the sponsored retirement plan.
Provide a way for participants to create an emergency savings fund.
Supply financial wellness education such as life stage planning.
Look at ways to help employees phase into retirement.
SURVEY METHODOLOGY AND RESPONDENTS
Online survey
15-minute survey conducted by Principal
Field dates
July 05, 2021 - July 12, 2021
Super saver respondents
1,408 Retirement plan participants
Margin of error
+/- 2.6% at a 95% level of confidence
Savings behavior
61% contributed $17,550+ to their sponsored retirement plan in 2020.
30% had a deferral percentage of 15%+.
Qualifications
Age 19-56
U.S. resident
Consumer has a retirement plan with Principal
Background
Principal conducts periodic "pulse" surveys with customers to gain insight into timely topics. This annual survey focuses on providing holistic perspectives on key trends and timely issues in today's market and economy.
The survey findings reported here explore consumer concerns and actions surrounding saving and planning for retirement, financial behaviors related to COVID-19.
Important information
The subject matter in this communication is educational only and provided with the understanding that Principal® is not rendering legal, accounting, investment advice or tax advice. You should consult with appropriate counsel or other advisors on all matters pertaining to legal, tax, investment or accounting obligations and requirements.
Insurance products and plan administrative services provided through Principal Life Insurance Co., a member of the Principal Financial Group® Des Moines, Iowa 50392.
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©2021 Principal Financial Services, Inc.
PQ12556K-02 | 09/2021 | 1836861-092021