Your Complete List of Pension Statistics for 2022

As our list of pension statistics for 2022 show, there are few things more important when preparing for your future than figuring out your pension. Pensions might not be the most exciting topic of conversation or some people, but they’re essential when protecting your financial freedom.

According to the Global Pensions Assets study, pensions account for around 80% of the GDP for many major economies, including in the US, UK, Canada, and Australia.

As of 2021, pension assets have increased by 11% year-over-year, and demand for flexible saving solutions is growing. Let’s take a closer look at the pension statistics you need to know in 2022.

Key Pension Statistics:

  • Pension assets rose by 11% even during the pandemic. However, some plans may fall short of their return assumptions due to the uncertain economy.
  • Living in some cities after retirement, like Alaska or San Francisco may require $1 million in pension savings according to estimates
  • Around 42% of Americans have no retirement savings, and only 36% believe their pensions are on-track.
  • Over 50% of people over the age of 55 left the workforce in 2021 due to retirement, marking an increase in retirement.
  • Around one in five Americans believe they’ll retire and access their pension between the ages of 60 and 65. Some Americans fear they’ll never retire at all.
  • 53% of employees think they’ll end up accessing their pension money for other expenses.

Pension Statistics: The Pension Market

1. Pension assets are rising in spite of COVID-19

OECD

Despite the confusion and economic uncertainty caused by the pandemic, pension fund assets are continuing to rise. The OECD report on “pension markets in focus” found the market exceeded $56 trillion worldwide at the end of the year in 2020, and the market grew by 11% between 2020 and 2021. This indicates a continued interest in maintaining a strong savings plan.

Despite this, a study named “Public Pensions, post pandemic” notes that public pensions have experienced some sideways and downward movement since 2020. Blackrock industries notes periods of market decline indicate some pension plans may fall short of their return assumptions.

2. Savers need $1 million in pension savings to retire in San Francisco

Magnify Money

If you’re living in one of the major cities in the US, you may need at least $1 million in savings to maintain an average lifestyle. According to Magnify Money, the amount needed to retire in cities like San Francisco and California are higher than ever.

Some of the most expensive retirement cities include Alaska, California, Hawaii, Oregon, and New York. The rest of the list also shows costs vary greatly depending on where you plan to retire with your pension.

Map

Description automatically generated

3. 64% of Americans don’t think their pension savings are on track.

Federal Reserve

In 2021, nearly one fourth of adults said they were financially worse off than they were before the pandemic. However, 75% said they were still doing ok overall. The Federal Reserve noted that a significant number of Americans (65%) felt their savings weren’t on-track for the future.

Furthermore, around 9% of adults said they had tapped into their retirement savings during 2020 and 2021 to help handle the confusion of the pandemic.

4. 42% of Americans have no retirement savings

PWC

According to PWC, around a quarter of US adults have no retirement savings, and only 36% believe their retirement planning is “on track”.

For those who are saving, PWC estimates the median retirement saving account of around $120,000 will only provide less than $1,000 per month on a fifteen-year plan, which simply isn’t enough given the increase of life expectancies and healthcare costs.

While the majority of people without pension savings fall into the age range of 18 to 29, 13% of people over the age of 60 also have no retirement savings.

Chart, funnel chart

Description automatically generated

5. 44% of pension plan sponsors set to review in 2022

Benefits Canada

Around 44% of pension plan sponsors in the US said they’re planning on reviewing or renegotiating their plan management fees in the next 1 to 2 years. The survey polled 160 US organizations representing around $974 billion in assets under management.

Average total fund expenses for asset owners in the aggregate environment reduced for the first time in the survey’s history, which isn’t surprising giving the continued suppression of active management fees. Non-profits actually paid the highest average management fees, while corporate plans paid the lowest.

6. Funding ratios for US Corporate pension plans fell in 2021

LGIMA

Reports from the Legal & General Investment Management America company and the Northern Trust Asset Management team found the funding ratio of the typical corporate pension plan fell by around 1.6% in November 2021, due to poor equity performance.

According to the groups, in this environment of increased uncertainty and volatility regarding the impact of new variants of COVID, plan sponsors will need to revisit their risk tolerance and look at potential implications for funded status volatility.

7. Auto enrolment has increased pension uptake

FCA

According to studies published in 2021, auto-enrolment features in companies has increased pension uptake significantly. Around 70% of non-retirees had a pension at the beginning of 2021, compared to 62% in 2017.

85% of people in the study were either saving for a pension at the beginning of 2021, or were involved with a scheme which allowed their employees to save for them on their behalf.

Pension Statistics: Retirement Statistics

8. A larger share of US adults is now retired

Pew Research

One major impact from the pandemic can be seen in the number of people taking advantage of their pension assets. As employers contend with higher numbers of younger employees quitting their roles, the COVID-19 recession is also prompting a rise in retirement among people over the age of 55.

According to Pew Research, by the third quarter of 2021, over 50% of adults over the age of 55 had left the labor force due to retirement. This is a significant increase from just over 48% in 2019.

Pew Research notes in other recessions, the number of people accessing their pension during retirement dropped. The opposite has happened in this case.

A bar chart showing that half of older U.S. adults are now retired

9. By 2031, the number of military retirees is expected to reach 2.28 million

Statista

According to Statista, the United States has one of the largest militaries in the world, and one of the largest defense budgets too. However, many veterans struggle to find a job and affordable lifestyles following deployment.

Statista notes that by 2031, the number of military retirees in the United States should increase to around 2.28 million – a massive growth from 2.19 million retirees in 2021.

Chart, bar chart

Description automatically generated

10. Around 68% of private industry workers had retirement plans in 2021

BLS.gov

In March 20221, reports showed around 68% of private industry workers had access to retirement assets via their employer, with 51% choosing to participate in pension plans. Around 92% of workers in government jobs (state and local) had access to retirement support, with 82% participating in programs.

Within the private industry, professional, management, and similar occupations had the highest access rate for retirement benefits in March 2021, at approximately 85%, while service occupations had the lowest access rate at only 40%.

Chart

Description automatically generated

11. One in Five Americans think they’ll retire between the ages of 60 and 65

YouGov

One in five Americans believe they’ll be able to retire somewhere between 60 and 65, with around 9% saying they’ll retire at the age of 65. Another 9% believe they’re more likely retire between the ages of 66 and 70, while around 4% say they don’t think they will retire until they’re in their 70s or older.

Members of Gen Z (41%) and the Millennial generation (41%) are more optimistic that they’ll retire before 66, compared to Gen Xers (31%).

Graphical user interface, application, Teams

Description automatically generated

Pension Statistics: Benefits and Opportunities

12. 53% of employees think they’ll need to use pension plan money for other expenses

PWC

The PWC employee financial wellness survey found that around 53% of millennials believe they will need to tap into the money held in their pension plans for expenses before they hit retirement. This number is also high among Gen X respondents. Around 35% of baby boomers feel the same way.

Accessing crucial pension savings before you hit retirement could put you in a dangerous position when the time comes to actually leave your job.

Chart, line chart

Description automatically generated

13. The average monthly benefit for retired workers is $1657 per month

Yahoo Finance

The social security administration has increased the cost of living adjustment to 5.9% for 2022 payments. This increase is one of the largest in history. According to the SSA, this will mean the estimated monthly benefits for all retired workers should be around $1,657 starting January 2022.

Before the COLA took effect, the average income per month for retired seniors was around $1565 per month. Retired couples receiving benefits together will receive an average payment of around $2753, while a widowed mother with two children would receive $387 per month.

14. Only 6.8% of older Americans working less than 30 hours a week get social security payments

CNBC

Only around 6.8% of Americans over the age of 60 working less than 30 hours per week get money from social security pensions. Around 40.2% of people in that category receive income through social security alone. Even worse, around 14.9% say they have no income from a pension, savings, or social security.

Chart

Description automatically generated with medium confidence

15. 401k millionaires are on the rise with 365,000 in 2021

Yahoo Finance

In August 2021, the average 401k balance was around $129,300, while an average IRA balance was over $135,900. For those who had been saving for over 10 years, the average savings were over $400,000, representing excellent opportunities for the future.

Additionally, in the first quarter of 2021, the number of 401k millionaires reached a leading high of over 365,000 people.

16. A quarter of Americans fear they’ll never be able to retire

YouGov America

According to YouGov America, around a quarter of professionals fear they’ll never have enough cash to feel comfortably in retirement. In a poll looking at 15,000 Americans in 2021, the YouGove group discovered 27% of adults (one in four) believe they’ll never have enough cash to retire.

The number is ten percentage points higher among people in Gen X, who are particularly concerned about their ability to retire comfortably.

Graphical user interface, application, Teams

Description automatically generated

17. A third of employees in hospitality, medical and retail positions think they won’t be able to retire

YouGov

The YouGov study found some people are more concerned about their ability to retire than others. The people least likely to worry about their ability to retire and access a comfortable pension in the study were those in Financial Services. On the other hand, 38% of retail workers said they would never be able to retire comfortably. 34% of medical practitioners, and 33% of hospitality staff felt the same way.

Pension Statistics in 2022

Pensions continue to be one of the most important ways to prepare for your future. If you want to ensure you have enough money to maintain your lifestyle when you get older, you need to think about what you’re going to do after you retire. Choosing the right pension is a crucial step.

Stay up-to-date with the latest pension statistics, and make sure you know how to protect yourself when the time comes to claim in retirement.

Was this post helpful?

Disclaimer

Although every effort has been made to provide complete and accurate information, Creditedhq.com cannot guarantee the full accuracy or recency of content on this page.