Though More Comfortable With Volatility Americans Still Lean Toward Protecting Retirement Savings
Americans are becoming more comfortable with market volatility in the short term, but market gyrations so far this year have them increasingly interested in finding ways to protect their savings from such volatility. According to the 2018 Market Perceptions Study* from
The desire for protection from these concerns has increased since the 2015 Market Perceptions Study.** When asked about their retirement planning, 57% of Americans said they are willing to give up some potential gains for a product that protects a portion of their retirement savings, up from 48% in 2015. Furthermore, when asked about important actions to take 5-10 years before the start of retirement to help make sure they have a more secure retirement, nearly a third (31%) said "putting some of my money into a financial product that offers a balance of potential growth (up to 10%) and some level of protection (no loss of money if the market goes down 10%)."
This need for protection in part comes from expectations of future volatility. A significant portion of Americans still fear a big market crash (42%) or a major recession on the horizon (44%). As a result, interest in financial products that offer a balance of growth potential and protection is growing.
"Volatility matters, and while we see some increasing comfort with volatility, it is driving a simmering anxiety in many Americans," said
The preference for a balanced financial product was even more pronounced for wealthier Americans. More than three-fourths (78%) of respondents with $200K+ in investable assets said it is important to them to have some of their savings in a financial product that protects it from market loss (versus 69% of those with less than
After staying below its long-term average for most of 2017, market volatility, as measured by the Cboe Volatility Index or VIX, has been more dynamic this year. In February, the VIX index spiked 115% on one day as equities sold off significantly, and saw elevated levels throughout March due to increased geopolitical tensions. Although the VIX index has edged back toward normal levels, it is still elevated from the low levels seen throughout 2017.
"As market volatility becomes a more constant part of our financial landscape, Americans are recognizing the value of options that provide both opportunity and a level of protection," added Kelash. "Because we can't be certain when the next major downturn will occur, it's important that people have the ability to grow their retirement savings while still safeguarding their financial future."
Zurich North America joins Ellevate Network to expand professional development resources for Zurich employees
CMS Unveils Scorecard to Deliver New Level of Transparency Within Medicaid, CHIP Program
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News