Retirement Concerns Persist for Healthcare Workers Amid Ongoing Pandemic

Healthcare employees value retirement plans providing personalized financial advice and guaranteed lifetime income in retirement.

34

Nearly one-quarter (24%) of full-time hospital and healthcare system employees are not confident that they will have enough money to live comfortably throughout retirement, and 13% have become less confident in this regard throughout the course of the pandemic. While many are saving more, 27% are not confident that they are saving an adequate amount. Likewise, while many have changed asset allocation during the pandemic, 18% are not confident that their retirement savings are invested appropriately. 

According to the study, few healthcare workers have considered how they will manage their retirement savings for income during retirement. Among those nearing retirement age (aged 50+), just 23% have given this a lot of consideration. They are also very concerned about the cost of retiree medical care, as well as long-term care if needed; 29% are not confident they’ll be able to cover out-of-pocket medical expenses, and 51% are not confident in their ability to pay for long-term care.

Among healthcare workers approaching retirement age, the study found that the top financial priorities for most are “not outliving their financial assets” (69%), “maintaining their standard of living throughout retirement” (60%), and “having income that will not drop with the financial markets” (57%). However, just 20% reported planning to convert some of their retirement savings into a payout annuity – a solution that can address these priorities by providing lifetime income during retirement.

“Advice is particularly important during times of economic uncertainty,” said Paul Yakoboski, TIAA Institute Senior Economist. “Within the past two years, 50% of retirement savers in the healthcare sector have received professional retirement planning and saving advice, and they are twice as likely to be very confident about their retirement income prospects compared to those who have not received advice.”

Other key findings from the Healthcare Sector Workforce: Financial Wellness, Retirement Readiness and Job Satisfaction report include:  Seventy percent of healthcare workers report feeling satisfied with their employment, including 18% who are very satisfied. Nonetheless, the survey found that one-third of full-time healthcare sector employees sought employment with a new employer at some point since the beginning of 2020. Thirty-one percent are likely to look for new employment within the next two years. 

Sixty-seven percent of healthcare workers likely to seek new employment within two years would find it very valuable if an employer offered a retirement savings plan that could provide stable monthly income guaranteed for life in retirement. This is noteworthy for employers reconsidering benefit design as they focus on employee retention and recruitment. Personalized advice and investment options that consider environmental and social responsibility factors are also retirement plan features highly valued by many.

The Healthcare Sector Workforce: Financial Wellness, Retirement Readiness and Job Satisfaction report is based on a survey of 1,500 full-time hospital and healthcare system employees in five occupation groups – registered nurses (RNs), physicians and surgeons, other medical professionals, office and administrative staff, and non-medical professionals – about their personal finances, financial well-being, and job satisfaction since the onset of the COVID-19 pandemic. The survey was conducted online from June 24 to August 2, 2021. To view the full report, please click HERE

About the TIAA InstituteThe TIAA Institute helps advance the ways individuals and institutions plan for financial security and organizational effectiveness. The institute conducts in-depth research, provides access to a network of thought leaders, and enables those it serves to anticipate trends, plan future strategies and maximize opportunities for success. For more information about the TIAA Institute, visit www.tiaainstitute.org.

About TIAATIAA is a leading provider of secure retirements and outcome-focused investment solutions to millions of people and thousands of institutions. It is the #1 not-for-profit retirement market provider1, paid more than $3.6 billion to retired clients in 2020 and has $1.4 trillion in assets under management (as of 12/31/2021).2