Retirement as a Last Resort: How Americans Cope with Financial Need

JUL 29, 2020 | Empower Institute

Data shows most plan participants want to avoid taking money out of their retirement accounts

As a result of the COVID-19 pandemic and related economic instability, many Americans are facing difficulty covering their expenses. A recent survey by The Harris Poll sought to find out how workers will cope if they experience financial trouble, and how likely they are to change their retirement plans or take money from their retirement accounts.

The survey results and Empower Retirement data shows that most workers consider withdrawing money early from their retirement accounts a last resort, but it’s an option some may use if they need access to money. The research also found that employees who receive advice from their employers are more likely to protect their retirement accounts and continue making contributions, which means employers can make a difference in helping workers stay on track.

Key findings:

  • When it comes to retirement savings, most Empower Retirement participants are staying the course.
  • Reducing spending is the first action people take when finances are tight.
  • Tapping into retirement savings is often a last resort.
  • As the pandemic continues, it’s important for employers to understand who is at most risk for making decisions that could have long-term negative effects.

Download the full research paper here.