Financial Literacy & Retirement: What Americans Don’t Know
Based on the results of a new survey, we have a lot of work to do helping younger workers prepare for retirement and helping near and current retirees plan for longevity and surprise healthcare costs.

Results from the 2024 TIAA Institute-GFLEC Personal Finance Index are in – and Americans know less than we think about retirement and how to prepare for it. What’s most surprising is how many current retirees still don’t work with a financial professional, plan for longevity, or understand what expenses Medicare does (or doesn’t) cover.

Let’s take a look at the most important stats from the survey. You can download the complete 19-page report here.

No time to read? Watch our video overview:

Retirement Planning

The survey asked 1,684 American adults age 22 – 75 five multiple-choice questions about retirement planning. One of the possible answers included “I don’t know.” For any given question, about 30% of respondents selected that option. Overall, respondents got about 40% of the questions right. Not surprisingly, the people who got more questions right felt more financially prepared for retirement. Here are the most important takeaways:

  • Only 53% knew that annuities offer a guaranteed income stream they can’t outlive.
  • Only 21% of pre-retirees work with a financial professional. Even among currently retired people, only 48% have professional guidance.
  • Only 34% of current retirees knew that Medicare only covers 75% of health care costs in retirement. That number drops to 26% for pre-retirees.
  • About 60% underestimated how long they are likely to live during retirement. Only 32% knew current life expectancy is age 84 for men and 87 for women.
  • 22% of people planning to retire didn't know how much money they had invested in their retirement account. For people who did know, 49% of them had less than $250,000.

We have a lot of work to do to change these statistics! People aren’t planning for longevity because they don’t expect to live as long as is likely. Annuities are a great fit for that situation since they remove any question of outliving their income.

Did you know you can see current rates for MYGAs, as well as quote multiple types of annuities right here?

Get access to the Annuity Rate Watch portal and grow your business with annuity sales!

Financial Literacy

The survey also included a 28-question segment devoted to basic concepts of financial literacy.

  • Younger workers have the lowest confidence in being able to retire. 15% of all people surveyed don’t plan to retire at all. 18% of all women surveyed don’t believe they’ll be able to retire at all.
  • Younger workers (age 22-34) don’t anticipate having access to Social Security or employer pensions to the same degree as current or near-retirees. Only 47% think they’ll have Social Security to rely on, and only 15% expect an employer pension.
  • 34% of people cannot pay off their credit card balance every month.
  • 1 in 8 Americans could not come up with $2,000 if needed for an emergency.
  • 44% of Americans have $50,000 or less in liquid investable assets (savings, stocks, retirement accounts, CDs, cash value in life insurance policy)

What this tells us is that younger workers – age 22-34 – are a good target market for self-driven retirement funding solutions. They don’t anticipate Social Security or employer pensions to be an option. 65% of them plan to rely on retirement accounts, and 39% plan to rely on money saved outside those accounts, but they probably aren’t aware that annuities and cash value life insurance could supplement these efforts!

Next Steps

It’s great to have information and stats like this…but what are you supposed to do with it? We can help!

  • Talk to a brokerage manager about ways to diversify your marketing and product offerings. Dave, Joshua, and David are all knowledgeable about products, strategies, marketing options, and advanced case planning. If you need ideas or want to geek out on strategy, they’re your guys. Call us at 800-823-4852 and ask to talk to a brokerage manager!
  • Use our monthly sales kits. Every month, we provide a sales kit with social media images + text, facts, stats, sales ideas, case studies, client profiles, and more. Make sure you’re signed up for our newsletter to get the kit every month.
  • Request access to Annuity Rate Watch through our website. Click here to see today’s rates for MYGAs and request quoting access.
  • Get Advanced Markets help. Click here to visit our Advanced Markets Resource Center for strategies, sales ideas, checklists, case studies, sample documents, and more.
  • Get marketing ideas from our blog! We’ve covered a lot of helpful topics from marketing to tech tools to SEO.

That's our look at the 2024 TIAA Institute-GFLEC Personal Finance Index!

Do any of these stats surprise you? Have you seen this reflected in your client base? Sound off in the comments!

Need help with quotes, illustrations, or selecting the right product?

Our Brokerage Managers - Dave and David - can help. They have incredible depth and breadth in terms of product knowledge. Call 800-823-4852 and ask for a brokerage manager, or click the button below to email us!