16:10 PM

Public Sector Retirement Plan Insights: Financial Security, Preparedness & Lifetime Income

Nationwide® 2022 Research

Government employees feel more optimistic about their retirement security than private sector employees 

They feel more positive about their retirement plans and financial investments 

  • Government employees are more likely than those in the private sector to have a positive outlook on their retirement plan and financial investments (76% of government employees vs. 56% of private sector employees) 
  • Government employees are also more likely to associate positive emotions with their current retirement plan and financial investments, including “secure” (35% government vs. 18% private), “confident” (32% government vs. 22% private), and “happy” (25% government vs. 10% private) 

They feel more financially prepared for retirement 

  • Three-fourths (75%) of government employees say they are on the right track when it comes to being financially prepared for retirement vs. 56% of those in the private sector 

 Public sector employees feel more secure about their future because many benefit from having pension plans, which offer guaranteed income in retirement  

 A much higher proportion of government employees than private sector employees are offered and participate in pension plans 

  • Over half (54%) of government employees have access to pension plans, and nearly all who have access participate in them (89%) 
  • In contrast, just 17% of private sector employees are offered a pension by their employers, though like the public sector, nearly all private sector employees who are offered a pension take advantage of the option (90%) 

Employees with pensions are more likely than those without to have a positive outlook on their retirement plan and financial investments 

  • Two-thirds (66%) of employees with pensions have a somewhat or very positive outlook, compared to just 57% of those without pensions 

Government employees report they are less negatively impacted by inflation than private sector employees  

  • Government employees are more likely to say inflation has not changed when they expect to retire (57% vs. 41% private), while private sector employees are more likely to say they are now expecting to retire later than originally planned due to the impact of inflation (41% vs. 28% government) 
  • 41% of government employees are moderately or extremely concerned about outliving their retirement income vs. over half (52%) of private sector employees  

Additional guaranteed lifetime income investment options are viewed favorably by the public sector because they offer a more predictable stream of guaranteed income in retirement and even deeper confidence that employees won’t outlive their savings  

  • Government plan sponsors are more likely to report high levels of favorability (86% government vs. 75% private) and comfort (73% government vs. 64% private) with the addition of guaranteed lifetime income investment options within employer-sponsored retirement plans 

Most government employees agree: 

  • I’m interested in guaranteed lifetime income investment options that help provide protection from market volatility (83%) 
  • I understand how guaranteed lifetime income investment options would benefit my retirement planning (77%)   

What are guaranteed lifetime income investment options? 

Today, retirement savers are navigating a perfect storm of issues. Inflation. Market volatility. Eroding confidence. Pandemic uncertainty. Guaranteed lifetime income solutions provide retirees with a stream of predictable income for life in their retirement plan and help offer public and private sector workers greater certainty against market volatility and outliving their retirement income.