COVID-19 Didn’t Change Older Americans’ Retirement Expectations: Study

It’s an intriguing finding that’s supported by EBRI’s 2021 Retirement Confidence Survey. In that study, “half of the workers and 72 percent of retirees reported that COVID-19 did not change their confidence in their ability to have a comfortable retirement,” Liu writes.

Resilience a Pleasant Surprise

Another finding was that results didn’t vary much among the different wage groups — no particular group reported their work was significantly more affected by COVID-19 than other groups.

That’s surprising, Liu writes, because the popular view was “that individuals with higher socioeconomic status tend to have more resources that may be utilized to cope with COVID-19- related stresses. However, from the average percentage point of view, no wage group in this HRS survey wave claimed that COVID-19 had a considerably greater impact on their job than other groups.”

The contrast between the pandemic’s reported impact on older adults’ work and financial situations versus the lack of adjustments in their retirement expectations and Social Security claiming plans was “a little surprising” at first, Liu explains. 

“We had heard both sides of the ‘presumptions’ before conducting our research. On one hand, the negative impact of COVID-19 on older Americans’ work and financial situations was significant. So, it is natural to assume that these participants would change their retirement expectations to a later age. On the other hand, all of us of course have heard lots of news about the Great Resignation (or reshuffling) at the beginning of 2022.” In the early stages of the research, Liu was curious to see whether older Americans were also expecting to retire earlier after the COVID shock, but the responses showed that was not the case.

“That was kind of surprising to me, but a good surprise,” he says. “Not only does this result demonstrate the resiliency of older Americans’ retirement expectations, but it also gives us a hint that there were some other factors, instead of the COVID shock, that were dictating the trend of these participants’ retirement expectations.” Future research could help identify those factors, he adds. 

Ed McCarthy is a freelance financial writer who holds the certified financial planner and retirement income certified professional designations.

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