Data and Research March 30, 2023

Women Working With Financial Pros Show Higher Retirement Readiness

According to a LIMRA study, women who work with a financial professional are more than twice as likely to have a formal written retirement plan as those who are unadvised. 

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Women who work with a financial professional are more confident and more prepared for retirement, new LIMRA data shows, creating a wider opening for retirement plans to respond to plan participants’ rising interest in and requests for professional advice on saving and investing. 

Women who work with a financial professional are also more likely to complete tasks to plan for retirement and report significantly increased interest in guaranteed lifetime income options, according to the LIMRA study, Impact of Financial Professionals on Retirement Security.

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The data showed that 40% of women who work with a financial professional report they feel very prepared for retirement, compared to 27% of women who don’t work with one.

“Prior LIMRA research shows having a formal written retirement plan—involving a comprehensive discussion about goals, asset management and risk mitigation—often leads to higher confidence levels and an increased likelihood of purchasing an annuity,” the research stated.

Women working with a financial professional are more likely to have a formal written retirement plan than those who are unadvised, 25% to 10%, the LIMRA data showed.

For women who work with a financial professional, there is an associated greater likelihood these individuals will complete several retirement planning tasks that are recommended to bolster retirement readiness, the data showed.

For women who work with a financial professional:

  • 53% have calculated the amount of assets and investments available in retirement, compared with 44% of women who have not worked with a financial professional;
  • 48% have determined what their expenses will be in retirement, compared with 43%;
  • 50% have estimated how many years their assets and investments will last in retirement, compared with 36%; and
  • 37% have developed a specific plan or strategy for generating income from retirement savings, versus 22%.

In a two categories, the LIMRA data showed smaller average differences between women who work with a financial professional and women without one. Women who work with a financial professional are less likely to have projected what their Social Security benefits are expected to be at different retirement ages, by a margin of 50% for those working with a professional have, while 54% without a professional have done so. The data showed similar results for women estimating their health care coverage including Medicare options and/or private insurance in retirement, where 41% of women working with a professional have, versus 46% who have not worked with a financial professional, LIMRA found.   

The LIMRA research did support separate research data that showed an expansion of expected retirement plan benefit features and attendant expected shift toward greater holistic financial wellness programs. Both plan sponsors and financial professionals expect a retirement transformation is ahead by 2030, research published by Principal Financial Group found.

More than three-quarters of each group, 78% of plan sponsors and 77% of financial professionals, anticipate the shift will be from focusing on the enrollment process to improving the retirement process —including adding new participant features—and to creating retirement income, the Principal data showed. 

Workers’ retirement readiness may also be improved, the report noted, as a result of plan sponsors urging every plan participant to complete retirement preparation tasks before their actual retirement.

In 2021, Charles Schwab Retirement Plan Services launched an online dashboard designed to walk participants through a financial health assessment in response to data that showed workers wanted more help saving, planning and with advice for retirement.

Charles Schwab’s 2021 401(k) Participant Study found 61% of participants want professional advice, an increase from 50% in 2020.

Women Retirement Challenges

For several reasons, women face greater obstacles to saving for retirement than men.

Bureau of Labor Statistics data showed that, as of 2016, women earned 21% less lifetime income than men.

A recent Goldman Sachs report, published in December 2022, cited Government Accountability Office data showing that women’s lifetime retirement contributions, on average, are 30% less than men’s.

While women in the U.S. should expect to live, on average, three years longer than men—according to a January 2021 Social Security Administration factsheet—they can be expected to need more savings for a comfortable retirement, yet among retired women, 58% report they collect 50% or less of their pre-retirement income, including Social Security, compared to 44% of men, Goldman found.

Women’s longer average lifespans, lower lifetime earnings and their resultant need for more savings has led to recordkeepers adding in-plan annuities for guaranteed lifetime income options.   

“Overall, women’s interest in guaranteed lifetime income increased 63% over the past five years, with a significant jump over the past year as inflation and economic uncertainty grew,” the LIMRA study stated. “LIMRA research [also] shows women who work with a financial professional are more likely to be interested in purchasing an annuity [and] more than half of women who work with a financial professional (52%) said they were interested in converting a portion of their assets into a lifetime-guaranteed annuity in retirement, compared with 44% of women who don’t work with a financial professional.”

Despite increased interest among women in guaranteed lifetime income options like annuities and despite federal legislation to facilitate plan sponsors adding annuities, many employers have not embraced in-plan annuities. Plan sponsors cite as reasons for their reluctance: fiduciary concerns; wanting to see how the market evolves; difficulty with participant communication; operational or administrative concerns; and potential participant use, data published this year by Alight Solutions showed.

LIMRA is a trade association representing the insurance industry, operating under the umbrella organization LL Global.

LIMRA surveyed Americans ages 40 to 85 with at least $100,000 in household investable assets to explore their perceptions of working with financial professionals to help make financial and investment-related decisions in August 2022. LIMRA gathered the data through an online survey of 2,053 women, according to a spokesperson.

Benefits March 29, 2023

Lower-Paid Workers Are Declining Employer Health Insurance, Workplace Benefits

Separately published research finds significant disparities in employer medical coverage and that employees’ participation in workplace benefits is based on income.

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Employee income is correlated to greater use of workplace benefits, with lower-paid workers using fewer because the cost is prohibitive, according to new Alight Solutions research on insurance and benefits enrollment’s connection to income and age.  

Although the overall rate for employee medical enrollment decreased slightly to 73% in 2023, down from 76% in 2021, employer-provided medical enrollment has declined by larger margins year-over-year for employees earning less than $60,000, according to the benefits and enrollment trends research.

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“When we look at medical enrollment rates by salary, we see a pronounced decline in medical enrollment year-over-year for employees earning less than $60,000,” the Alight white paper stated.

Workers with salaries less than $40,000 have the lowest medical enrollment rate at 56%, compared to 84% for individuals who earn more than $100,000. Overall, 45% of the employees that said they declined employer medical coverage indicated it was because the benefit was unaffordable, research showed.

“Income, combined with increasing costs of medical coverage, other financial challenges and expanded marketplace premium subsidies, may account for the overall decline in medical enrollment year-over-year,” stated the report section on medical coverage enrollment. “Employees simply may not be able to afford medical coverage from their employer.”

Employees who decline the employer medical plan are either going without medical coverage, or are covered under a spouse’s or parent’s plan; Medicare or Medicaid; or a health insurance marketplace, the research stated.

While lower-income employees decline medical coverage at higher rates than higher earners, research from health savings account platform provider Lively found that 84% of HR leaders expect to plot increased benefits to attract employees in 2023.

The research also found 58% of employers reported enhancements to health coverage, 60% of HR leader respondents rated health care as a top-three employee benefit and 36% of HR leaders reported that employees asked for better health coverage from their employer.  

Medical Enrollment

Alight found employee medical enrollment highest among individuals 65 and older, at 66%, and lowest for the 21 to 25 age group cohort at 39% research showed.

For employees earning $20,000 to $39,999, enrollment in employer-provided medical insurance decreased to 56% in 2023, from 60% last year and 65% in 2021; for employees earning $40,000 to $59,999, enrollment decreased to 78%, from 80% last year and 82% in 2021; and for employees earning $60,000 or more, enrollment remained static between 83% and 85%.  

The average total annual cost of medical coverage in 2023 is $5,330 for single coverage and $13,998 for family coverage—an increase of 2.3% and 3.2%, respectively, compared to 2022 costs, stated the Alight research.

“Employees are carrying a larger share of the medical cost increases, with an average increase of 3% for single coverage and 4.6% for family coverage,” the research found. “Overall, employers are contributing 72% toward the cost of single coverage and 70% for family coverage.”

The average annual medical cost to employers of single coverage increased to $3,757 in 2023, from $3,684 in 2022, and increased for employees in 2023 to $1,573, from $1,527 in 2022. The average annual medical cost to employers for family coverage increased to $9,904 in 2023, from $9,645 in 2022, and for employees increased to $4,094 in 2023, compared to $3,914 in 2022, Alight found.

Preferred provider organization, health maintenance organization and high-deductible health plans were the medical plan types, Alight research examined.

In addition to Alight’s findings, research published separately by financial technology and business services company HealthEquity found that among workers with yearly earnings less than $100,000, 45% said several workplace benefits are unaffordable.  

HealthEquity found that 57% of workers earning less than $100,000 do not participate in the employer-provided health savings account, while 50% of workers who earn more than $100,000 do participate.

While the data showed worker participation rates in health savings accounts that are different from Alight Solutions, the reason is unclear.

According to Alight, employer high-deductible health plans paired with health savings accounts are “more attractive to older employees with higher earnings,” the paper stated.

Overall, 80% of employees participate in an HSA in 2023, compared to 79% last year and 78% in 2021, according to Alight. HSA participation by salary showed discrepancies based on income.

  • For workers earning more than $100,000, 91% participate in an HSA;
  • For workers earning $80,000 to $99,999, 87% participate in an HSA;
  • For workers earning $60,000 to $79,999, 82% participate in an HSA;
  • For workers earning $40,000 to $59,999, 74% of workers participate in an HSA; and
  • For works earning $20,000 to $39,999, 61% participate in an HSA.


“The perceived risk of HDHPs—that is, the need to pay a large amount up-front for medical services (the deductible or more) along with the variable nature of those costs—may make these plans less attractive to some employees even if the fixed annual premium cost of these plans is lower than other plan types,” the Alight research paper stated.

Alight Solutions gathered data for the research from October through December 2022, a spokesperson said. The report included data from more than 450 organizations, totaling more than 9.5 million employees.

The HealthEquity research, Employees: Perspectives on Benefits and DEI, was published in January. The data was gathered by HealthEquity through an online survey conducted from November to December 2022. The total sample size comprised 1,387 respondents: 1,003 marketplace responses and 384 HealthEquity participating members.  

The Lively Employee Benefits Pulse Check report partnered with CITE Research Inc. for the report and surveyed 250 HR leaders across the United States in multiple industries, according to a spokesperson.

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