Summary
Retirement Plans and Retirement Confidence in Higher Education
• Faculty savings behavior and perceptions: The Retirement Confidence Survey of College and University Faculty was conducted by the Employee Benefit Research Institute (EBRI), Mathew Greenwald & Associates, Inc. (MGA), and the TIAA-CREF Institute, and underwritten by TIAA-CREF, to better understand the retirement planning and saving behavior of college and university faculty, as well as to gauge perceptions regarding various aspects of their retirement preparations.
• Differences with the private sector: Higher-education faculty members tend to be older, more educated, and have higher incomes than the working population as a whole, and the structural pension plan design differences in the higher-education sector also make a significant contribution to the better retirement outcomes expected by faculty.
• Most faculty confident in retirement prospects: Thirty-five percent of higher-education faculty members are very confident that they will have enough money to live comfortably throughout their retirement years, and an additional 51 percent are somewhat confident. By comparison, 40 percent of all working Americans are somewhat confident and only 25 percent say they are very confident.
• Reasons for relative confidence: Among college and university faculty, 95 percent have begun to save for retirement and 66 percent have tried to determine how much they will need for a comfortable retirement, compared with 69 percent and 42 percent, respectively, of all working Americans.
Retirement Annuity and Pension Income Among Individuals 50 and Over
• Demographic factors remain key indicators: Gender, marital status, age, education, and other demographic variables have a significant impact on the likelihood of a worker receiving a retirement annuity and/or employment-based pension income in retirement.
• Gender gap closing: Women’s participation in retirement plans has risen significantly in recent years, closing the gap in retirement plan participation with men, so the aggregate pension and annuity recipiency for women are likely to increase over time for younger generations. But low-income women over 50 will continue to be least likely to receive annuity and/or pension income.
• Annuity income streams disappearing: Future retirees may not have a steady income stream in retirement, as defined benefit pensions decline, which means they will likely be more reliant on assets they must manage themselves instead of receiving a stream of income for life (i.e., an annuity).