Sh Sh Aver Shar ar are e e age With Debt, With Debt, With Debt, and Median Aver Aver Aver Debt age* age* age* -to and and and -ToMedian* Median* Median* tal-Net-Wea To To Tota ta ta ltl l l h Debt Debt Debt Ratios by Worker Confidence for Those With and Without a Negative How the COVID-19 Pandemic Could Impact Retirement WSp orker and Retiree Confidence in eakers Financial Security Throughout Retirement Retiree Confidence in Other Aspects Related to Retirement Worker Confidence in Doing a Good Job in Preparing for Retirement Worke Cost A Lo Savi In HSA Advers -Prog ng ok Con r Confide Diff s e re at Needs er Sele tr ss HSA I ibutions ence Rese ct ion s for Me nves nce ar for Oncology Amo ch and tors in dica Other ng Stat re COB e Benef Taxe Aspe Medici RA s ici En cts ar nes rolle ies Rela es ted to Retirement Heal EBRI Upcom th Rese Care T ing arch EBRI opic Centers Programs s & Surveys Job Future Chang Rese e Stat arch us and Expected Job Status Change Aggrega Impa Impact ct of of te Inv Beha Impa esvio tmen ct ral t Change Lossess Retirement Research Co Co Ag Coe nd nd nd and Year itional itional itional on on on Having Having Having Debt, Debt, Debt, 65 50 75+ Yea – –74 64 Years Years rs Old Old Old Employment Status Change Income Adequacy for U.S. Workers How confident are you (and your spouse) about the following aspects related to retirement? How confident are you (and your spouse) about the following aspects related to retirement? Q&A Overall, how confident are you that you (and your spouse) will have enough money to live • 401(k) AUM Projected Through Year-End 2030 by Plan Size and Employee • For this studH y, ow w e couse nfiden d a t ar commercia e you that yol uda (an tab d yase our sp of cla ouse) ims f are d rom oing a good job of preparing Differences by Change in Employment Status Centers function as think tanks within EBRI. Each analyzes the state of Retirees n=1,024 Workers n=1,018 Increase in Retirement Deficits Above the $136.43 Billion Experienced in the comfortab finlan y th ciral ou lyg fo ho r u yt oy uo ru rreti reti remen remen t?t years? • • • • • Sa For thi For thi Me For thi vin dica gs stud s stud s stud s retarg buy y y y e- , , , ts f in w w w e e e a o n r Med u u ua se se se lyd d d sis a co da da icata ta remme from from benrci eEBR EBR fici al ad rie I’s HS I’s HS atab s aA Da A Da se of tab tab claa a im se se s empDemograp loyer-sponso hics red as plan a sFunction of Alternative Financial Market Assumptions (with Very Confident Somewhat Confident Workers n=505 • Recently Released $160k • In Progress/In the Pipeline 80% Has your employment status changed Very s Cinc onfe id ent 2020 Workers n=1,0 Somew 18, n=5h 0at 5 Confident Recently Released 2020 Workers n=1,018, n=505 2020 In R th ete ir ne ees xn= t 61, mont 024, n= hs 499 do you believe your March 2020: March 2020: Intermediate Market Loss Assumption 40% Match The comb susp inen edsio imp ns, act of all reduce d play • Sav of the ings and current sy Caregiving stem in the Age and of the COVID potential 19, America impact of p n Savings Educa ropos tion ed Co policy uncil $1 Aggregate 60k of Market Loss Assumptions Combined With Scenarios 1 –5 on th 80% e Previous fell from empl betwee oy n er 8 a -spo nd 10 nso pe red rcen plan t from 20 s 19 Older households in all special emphas February is 1son t, 20the 20? impact of the SECURE employ Act) ment status will change? Among Among those those ages ages 65 75 and –74, Projected Deficit Increase Due to the Current Pandemic Under Optimistic, Intermediate, Market • vol Hatil ow ity many may work be ers t m he ight switch from an employer-based health plan to Medicare if given the option, and how might $160k 80% • • Only To w ha abt ou ex t ten 6% t of are HSA o state t wax ne la rs w in s vest t correhe lated ir acco with un con ts. tributions to HSAs? • COBRA is an arrangement that allows recently-separated contributions, increases in Slide No Negative Negative inAmong termediathose te assu ages mp Yotio u wil 50 n l s, ha– ve64, enough mone $ y140k 70% • Prelimina • Cost Di ry ffere Analysis nces in on Onco the I lomp gy act of the 2020 Ma • rke Med t Crisis icare Bu on y-in Analysis Meeting – July 22Workers n=5Zah 05 ra Ebrahimi, Workers n= Ov 5erall 05 Jake S Spending pieg on el, Health Care Services, Very Confident: 40% changes. age groups that af fhav ect em e ployers? 35% and Pessimistic Market Loss Assumptions Very Confident: 24% both older the , the Ysh ou wil per ar l e hace ve of e ntage nhous ough mo ehold of ney to tas ke care of your largest •facto Predic r d ted urin exg penses this crisi include s in prem iums, deductibles employment employment $140k 70% to take care of your basic expenses 38% 44% 81% • What can Previous rese we le arch arn ha abs sho out the wn acco that un insure thold rs ers paw yho more have for • Impact of the CARES Act on Retirement 33% Income 42% Adequac 75% y workers to continue their enrollment in emplo 2018 yer-sponso 2019 red 2020 Mar by ch 20 Coverage St 20 atus, 2018 Retirement Income Adequacy Net V/S Confident: 85% withdrawals, and decreased although damaging, appears Research Associate, Research Associate, $140k Net V/S Confident: 69% 70% the average • Som % e V e(a s ry tat /S nd es ome do median) wha not t Co lev nf yide a s nt tate income tax, and some states do not offer a break status on chan sge tat *e tax stat esus for chH an SA ge*contributions basic expenses during your retirement during your retirement and out-of-pocket expenses The Retirement Savings Deficit* for All U.S. Households Before the COVID-19 Pandemic became more 2018 2019 2020 (vs. 85% in 201Mar 9) ch 2020 $120k 60% increasing retirement deficits, having those having debt debt and the as average well as • A Look at HSA Investors • Workplace Wellness Survey on tran col sitio ogy ne med d to ici inne vestin s whe g?n they are administered at hospital • Retirement Confidence Survey 30% Findings: Financial Wellness & Debt Webinar – July 28 • he Workpl alth in ace sura Well nce ness Survey EBRICOBRA Full-Time Employed EBRI man eligib ag ility ea do ble. no Eve t ha n ve a the s much • Retirement Security Research Ce $120 nter k 60% They will have enough money to live comfortably in retirement 67% 47% total debt sharply increased First year asked (1992): 68% Workers First year asked (1992): 78% • Balance Growth of Those Having Both a 401(k) Plan and an IRA • The value of a marginal dollar contributed to an HSA is higher in a state with high income taxes, and vice versa for $120k 60% esp leverage ecially un d betwee der the pe n ssimistic • Savings targets fell because the Medicare Trustees (a average nd median) and amount median of debt debt outpatient departments rather than physician’s offices $30,000 impact, though they could have a combination of pessimistic $100k 50% $26,638 • Retirement Confidence Survey — Before and After the Start of • Savings Needs for Medicare • Consumer Engagement in Health Care •• C s RtOBR ev ates am A w ped it benefit h low surv /s no ey can s inst tate be rum tex ax en pensi ests to ve, m ake and m enrollees ore consis hav tent e 60 witday h otsher to dec surv ide eys to , which helps in identifying trends, and Workers 25% from • Mo 1992 st HSA o T hto ey w 2016 ill w han vee . ers nouw ghh m oo n in eyve to st lastd tho e so ri ir entire g lih fet away 62% 39% You will have enough money • COBRA lowere : A d re S project ubsidies ed costs for Needed? Medicare Par – t DAugust 4 assumptions. $100k 50% Very VConf ery Conf iden id t:e 1n 7t% : 26% 1992 and 2016. For • Center for Research on Health Benefits Innovation You will V ha ery ve e Confi nough mo dent ney to take care of your incr stay ease ed relativ d over ely the the period. same Yes, in a 17% 23% Yes, in 27% a 24% $100k $25,000 50% assu significan mptio • t ns in Ass flue to on tet aly nce ke ca and inre crea on of De ind yosed ur m bt ivi e the d Ho du icaal l ldings e xpenses of American Families the tadded Pandem ake them ins tup, rum ic s ent o ts here to gauge existsim a pac potent t ofia C l OVI for 28% adv D-19 ers pandem e selectic ion 42% where only 70% 22% 42% 64% Beneficiaries Since 2020 Survey premiums and out-of-pocket 1 1 ex %penses 18% • However, it was unclear whether the cost differences were Net V Ne /S t V Conf /S Conf iden id t:e 6n 0t% : 74% They w m ile l d hica ave l e exp noe un gse h to s d ta uri ke n g ca yo re ur o fr e m tir ee dm ical entexpenses 63% 46% positive way positive way $80k 40% during your retirement • Of those who do not invest right away, most decide to start investing 20% (vs. 80% in 2019) • We f thos ind tha e who t ant con icipat tribu e high tionm s edic ten al de cos d tto be s will enroll lower in states with no income tax or do not offer a tax instance, the average $19,325 (vs. 59% in 2019) houdur sehing olds. this period Plan termi. nations $18,752 aggregated retire Very me n Confi t dedent ficits by $80k 14% 21% $25% 20,000 21% 40% • Winter Policy Forum – December 10 Very or Somewhat Confident because of different treatment regimens or different patient $80k 64% 67% 69% 63% 40% • Financial Wellbeing Research Center after their first few years of account ownership • Re Thtirement ey will have enIncome ough to take care of basic expenses 72% 55% • Consumer Engagement in Health Care Survey First year asked (1992): 55% • be For a 90 • ne HSA Co fit on pe con rcen ntrib tribu t utio cha tion ns nce san of d State having Tax enes ough • Future of health care benefits focus total debt-to-total-net- First year asked (1992): 60% would have the greatest impact on 11.2%. $60k 30% 15% • The Impact of Rising Household Debt Among Older Americans $15,000 • O cha ur stud ractey ristics finds that COBRA beneficiaries spent significantly Pre The Impact of Risin Retirem liminary Ana ent Confidence Survey lysis g Household D on the Impa — ct of the Before and ebt Among 2020 $60k 30% They will have enough for long-term care expenses 56% 28% Yes, in a Yes, in a to cover health care expenses in retirement, groups Very or Somewhat Confi $60k dent 30% • Added Retire new es survey instruments to better gauge telem 60% edicine usage, 63% wellness 67% offerings in the Ve w 64% ry ork Conf plac idene, t: 2 3and % the retire • men Long t in er come acco ad uneq t ten uaure cy. s and larger account balances are wealth ratio of those You will have enou10% gh money 15% • Trends in Student Loans Very Confident: 17% • California, South Dakota, Washington, and Wyoming had slightly higher than above average contributions, while Surveys Available due to Member Sponsorship more • Ad tha verse n tho Se se w lection ith cove Amon rag g e COBRA through a full-time employee $8,676 neutral way 27% 41% neu68% tral way You will have enough money to last your entire life 22% 41% 63% $10,000 th Net V/S Confident: 74% 10% $40k 20% impact of the COVI toD la -19 st yo pandem ur entireic life on workers Net V/S Confident: 57% a couple with drug expenses at the 90 $6,724 • This stud Theyy a re iso dola ingted a go o the d job cost prepariof dru ng for retirem gs the ent mselves 67% 49% Alaska, Florida, Nevada, New Hampshire, New Jersey, Texas, Tennessee had below-average contributions associated with an increase in the probability of $5,652 $40k (vs. 76% in 2019) 20% ages 50–64 increased (vs. 58% in 2019) $40k 20% (FTE) Enrolle Ve ery s Confident • Copayments vs. Coinsurance Market Cr After isis on Re the Star Older tirem Ame t 32% of the Pandemic ent I ricans 35%ncome 30% Adequac 26% y • Individual Retirement Account Withdraw Moder alsated in the by: He Bret alth t $5,000and Retirement Study • Please visit ebri.org for more information. percentile needs to have saved $325,000 The Medicare system will continue to provide benefits of at least equal value to • Re tran tirement sitioning Co to in nfidenc vestine gSurvey 5% $20k 10% • Future of Health Benefits Focus Groups from • •16 Som Dper isaggregat e ce stat nt esed in that the do difprov ferenc ide es a in tax pat benefit ient c harac for HSA teris cont ticsribut and io the ns had some of the 58% lowest average c 39% ontributions, such as Hammond, Research Yes, in a Yes, in a $20k 10% the benefits received by retirees today • COBRA beneficiaries used an average $20k of $18,752 in health care services, 10% You will have enough money to pay for $0 Very or Somewhat Confident 11% 12% 75% 82% 77% 76% c Kentuc ompos kit yio , M n ary of tland, he drugs Virginia, them and selves Mississippi You will have enough money to pay for long-term negative way negative way • Spending Profiles; Findings from HRS and CAMS = Up significantly from previous year = Down significantly from previous year Individual Coverage Family (Household Family (Individual Level) Very Confident: 15% 1992 to 27 long-te perc rm caent re, such in as nursing home or Leader, Client Analytics Very Confident: 17% compared to $6,724 for those with FTE coverage 0% • • Al Tig hen re your br isn’t much and evid – enSp ce to onso sugge r these events: contact B st that account etsy Jaffe, jaffe@ebri.org • We Th are e So ccial urrent Secu lyri c ty onduct system in w g ill foc con us tin groups ue to prov w ide ith bbenefit enefits s of ex at ec leaut st iv ees qua tl o va ex lue plore their organizations’ responses to the • Consumer Engagement in Health Care Survey 0 0% care, such as nursing home or home care, sho 15% uld 37% 52% Level) 18% 36% 54% 55% 35% Net V/S Confident: 52% home care, should you need it during Net V/S Confident: 50% 0 0 0% 0% = Up significantly from January 2020 = Down significantly from January 2020 to the benefits received by retirees today Group, Capital Group • C Eac OVI h D drug -19 w pandem as more ic,ex and pensi under ve at w hat an H cOPD ircum , sand tancranged es they fm rom ight being choose to stop offering health benefits you need it during your retirement 2016. (vs. 59% in 2019) • We also owners w use ait d to accu the resu mul lts of ate a sp this a eci na fic lyba sis la as the nce be first insta fore llment of a new series of Research Round-Up your retirement • Workplace Wellness Survey = Up significantly from previous year = Down significantly from previous year • The ratio of spending by COBRA enrollees to spending by 28% more expensive to 328% more expensive • Workp No, lac empe loymen Wellne t status h ss as Survey No, employment status will EBRIn investin tera g ctive visualizations 68% Average, 50-64 Average, 65-74 55% Average, 75+ All bolded percentages are statistically s= ign Up ificsa ig nn t ificantly from January 2020 = Down significantly from January 2020 Average Median • Copayments vs. Coinsura = Up nce = Up sigsn ig ifin cia fic na tln y tl fro y fro m m pre pv re iovu io su yse y ae r ar = Dow = Dow n s nig sn ig ifin cia fic na tln y tfro ly fro m m pre pv re iovu io su ys e y ae r ar people with FT noE t chcove angedrage has decreased over time, sugge nsting ot chan ge • Financial Wellbei *Negative employment status changng e or anE ticimploy pated negativer e chaS ngeurvey in employment status in next 6 months Average Median • The average insurer reimbursement for oncolog Median y dru , 50gs -64was $13,128 at M Aver edian age , 65-74 Median Median, 75+ EBRI Webinar = Up = Up sigsn ig ifin cia fic na tln y tl fro y fro m m Ja J na un au ry a ry 20 2 20 020 = Dow = Dow n s nig sn ig ifin cia fic na tln y tfro ly fro m m Ja J na un au ry a ry 20 2 20 020 Contact Betsy Jaffe jaffe@ebri.org to find out how to leverage these resources • High deductibles don’t seem to be an impediment, either that ACA exchanges have partially mitigated adverse selection • phy When sician’s it com of es fic tes o health and $21,881 care utiliz at at hos ion, pit are als workers more sensitive to coinsurance or copays? * Retirement savings deficits are the present value Jul ofy retirem 15, 2020 ent deficits for those households simulated to run short of money in Note: * In 2016 Dollars; HRS Household weight applied for analysis. S S S S retirem ourc ourc ourc ource e e ee : : : : n E E E E t.m m m mp p p ploy loy loy loye e e ee e e e B B B Be e e en n n ne e e efit fit fit fit Rese Rese Rese Resea a a arch rch rch rch In In In Institu stitu stitu stitute te te te a a a an n n nd d d d Gre Gre Gre Gree e e en n n nw w w wa a a ald ld ld ld & & & & A A A Asso sso sso ssociat ciat ciat ciate e e es, s, s, s, 1 2 2 19 9 0 01 9 1 92 8 2 8, , – –2 2 2 20 0 0 01 1 2 29 9 0 0, , Ret Ret a an nd d ir ir e e 2 2m m 0 02 2 e e0 0 n n Re Re t t Con Con tire tire ffide ide m me en n n nce ce t t Con Con S Su uffrv rv ide ide e ey y n ns s ce ce a a n n S S d du u M M rv rva a e erch rch y ys s Note: * In 2016 Dollars; HRS Household weight applied for analysis. Not S S Sourc ourc ourc e: * e e eIn : : : Ja Ja Ja 20 ck ck ck 16V V V Dollars; a a an n nDerh Derh Derhe e e HR iii, , , “ “ “Im Im Im S Ho p p pa a au ct ct ct se o o offfh th th th old e e e w COV COV COV eigh ID ID ID t a - - -1 1 1 p9 9 9 p li P P P ea a a dn n n fd d d oe e e r m m m an ic ic ic ao o o lyn n n sis. Ret Ret Retir ir ire e em m me e en n nt t t In In Inco co com m me e e A A Ad d de e eq q qu u ua a acy cy cy: : : E E Ev v vide ide iden n nce ce ce Fr Fr Fro o om m m E E EB B BRI’ RI’ RI’s s s Ret Ret Retir ir ire e em m me e en n nt t t Source: Employee Benefit Research Institute estimates from the Health and Retirement Study (HRS). Source: Employee Benefit Research Institute estimates from the Health and Retirement Study (HRS). ® ® ® © © © Em Em Empl pl ploy oy oyee ee ee Bene Bene Benefi fi fit t t R R Res es esea ea earc rc rch h h In In Ins s sti ti titu tu tute te te 20 20 2020 20 20 27 28 29 16 19 24 21 20 13 14 26 12 22 25 18 15 23 31 32 11 6 4 7 8 2 9 2 a S a S 2 S S Sn n 0 0 ourc e e e ourc d 2 d 2 cu cu cu 0 0 M M ri ri ri RC RC a a ty ty ty e erch rch : : P P P S S E Eroje roje roje m m Ref Ref 2 2p p 0 0loy loy 2 2 ctio ctio ctio ield ield 0 0 e e RC RC n n n e e .. M M M B B S Se e o o o Ref Ref n n d d de e e e efit fit lllield ield ,” ,” ,” Rese Rese E E E ..B B BRI RI RI a arch rch Issu Issu Issu In In e e estitu stitu B B Bri ri rie e e te te fff, , , a a n n nn n o o od d . . . 5 5 5 Gre Gre 0 0 05 5 5 e e (Em (Em (Em n nw wa a p p pld ld loy loy loy & &e e e A A e e e sso sso B B Be e en n n ciat ciat e e efit fit fit e eRese Rese Rese s, s, M Ma aa a a rch rch rch rch rch 2 2In In In 0 02 2 stitu stitu stitu 0 0 Ret Ret te te te, , , ir irA A A e ep p p m m ri ri rie e l l l n n 2 2 2t t 1 1 1Con Con , , , 2 2 20 0 02 2 2 ffide ide 0 0 0). ). ).n nce ce S Su urv rve ey y Ref Refield ield.. Source: Employee Benefit Research Institute estimates from the Health and Retirement Study (HRS). Source: Employee Benefit Research Institute estimates from the Health and Retirement Study (HRS). Source: Jack VanDerhei, “Impact of the COVID-19 Pandemic on Retirement Income Adequacy: Evidence From EBRI’s Retirement ® Security Projection Model ,” EBRI Issue Brief, no. 505 (Employee Benefit Research Institute, April 21, 2020). © © © © © © © © © © © © © © © © © © © © © © © © © © © Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Em Emp p p p p p p p p p p p p p p p p p p p p p p p p p plllllllllllllllllllllllllllo o o o o o o o o o o o o o o o o o o o o o o o o o oy y y y y y y y y y y y y y y y y y y y y y y y y y ye e e e e e e e e e e e e e e e e e e e e e e e e e ee e e e e e e e e e e e e e e e e e e e e e e e e e e Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Be Ben n n n n n n n n n n n n n n n n n n n n n n n n n ne e e e e e e e e e e e e e e e e e e e e e e e e e efi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fi fit t t t t t t t t t t t t t t t t t t t t t t t t t t Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Res Rese e e e e e e e e e e e e e e e e e e e e e e e e e ea a a a a a a a a a a a a a a a a a a a a a a a a a arc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rc rch h h h h h h h h h h h h h h h h h h h h h h h h h h In In In In In In In In In In In In In In In In In In In In In In In In In In Ins s s s s s s s s s s s s s s s s s s s s s s s s s sti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti ti titu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tu tute te te te te te te te te te te te te te te te te te te te te te te te te te te 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 20 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 02 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 20 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0

Volume

Pages