77% of gig workers would rely on personal savings to fund retirement

New York, NY, April 5, 2023 — A sixth segment of a broad new study sponsored by Legal & General Group, U.S. Gig Economy, Part 6: Gig Workers come up short on their future financial and retirement planning, [link] was released today. It follows a Special Report for International Women’s Day, Tasked With Both Childcare and Earning, Women Fall Behind Their Male Counterparts, which looked into the gender pay gap, lowered retirement expectations, and other inequities experienced by female gig workers. This latest report looks into the financial challenges people working in the U.S. Gig Economy face as they contemplate a post-retirement life.

This sixth report in the data-rich study explores the challenges many gig workers face, from being unable to cover an unexpected $1,000 expense to lacking the ability to plan for retirement. The study found that more than half (53 percent) of the freelancers surveyed thought that gig work negatively impacted their access to savings and retirement plans, while 29 percent felt that choosing to work this way negatively affected their ability to save.

Though they have higher levels of financial literacy than the average American, independent workers find that retirement planning poses a particularly difficult challenge, according to Legal & General’s U.S. Gig Economy research. While the survey elicited a complex array of responses to a question about which financial security benefits they hold, more than three-quarters (77 percent) of those surveyed said their own personal savings will provide the largest contribution to their retirement income—while 30 percent of gig workers never expect to retire at all.

Gig workers have to double as their own CFO

Legal & General’s study looks at the multifaceted societal factors leading to gig workers’ long-term financial insecurity, including the added stress of managing their own long-term financial matters far more conscientiously than traditionally employed W2 workers do.

“Our research points to some key differences between gig workers in the U.S. and those in the UK, notably the different mindset the two groups have toward saving. Parsing the issue for U.S. freelancers has allowed a view into some potential solutions to freelancers’ financial anxiety, particularly around unmet insurance and retirement needs. We hope some of the ideas presented in this report will lead to innovation that can create better financial habits and, in the end, improved long-term financial security for gig workers.” 

John Godfrey, Director of Levelling-Up, Legal & General Group

 

Future segments of this research will look in depth at the pandemic fallout for gig workers; and what it would take to get gig workers to go back to the traditional workplace. To receive a pdf of any of these reports, please email Meir Kahtan/MKPR at [email protected].