Research shows health contributes to retirees’ feelings of financial security, enjoyment and fulfillment
ENFIELD, Conn. – Whoever said, “If you have your health, you have everything,” must have been retired.
Research by MassMutual Retirement Services finds that health is typically more important than wealth when it comes to determining the well-being of America’s retirees. Retirees in better health are more likely to feel financially secure, enjoy retirement, feel fulfilled, and are less likely to experience negative emotions, according to the study.
The study, Health, Wealth and Happiness in Retirement, is part of a larger research project conducted on behalf of MassMutual by Greenwald & Associates. The research split 905 retirees into two subgroups: those who characterized their health as excellent or very good and those who characterized their health as good or poor.
“The message for both retirees and pre-retirees is that health has a major impact on satisfaction with life in retirement. We need to focus on our health as much as possible so we can enjoy life to the fullest extent in our later years,” said Elaine Sarsynski, Executive Vice President of MassMutual Retirement Services and Worksite Insurance. “While none of us can predict how healthy we will be in the future, we can help influence the outcome by making lifestyle choices that promote good health.”
The study shows that the loss of health is more costly to a retiree’s overall experience than the loss of wealth. Three-quarters (76 percent) of those with $250,000 or more in assets report having a positive retirement experience, compared to 68 percent of those with less than half the assets. However, the health gap is much steeper: 80 percent of those in better health report having a positive experience in retirement, compared to only 59 percent of those who are in poorer health, regardless of how many assets they own.
Seven out of 10 retirees (73 percent) in better health say they feel financially secure compared to 51 percent of retirees in poorer health, the study found.
In addition, retirees in poorer health were twice as likely to feel anxious about their finances and lack a sense of purpose, and three times more likely to feel lonely, the research found. Also, four in 10 retirees overall say they spend more on health care than they expected before retiring, with 43 percent spending more than $5,000 annually and 14 percent spending more than $10,000.
In focus groups conducted as part of the study, many retirees expressed concerns about the potential impact of their family health history, especially in later years. Many retirees also talked about working longer to maintain their healthcare insurance although earlier research by MassMutual (Hopes, Fears and Reality – What Workers Expect in Retirement and What Steps Help Them Achieve the Retirement They Want (www.massmutual.com/retire) showed that nearly half of all retirees (45 percent) retired sooner than they anticipated.
“Our study focused on people in the first 15 years of retirement. In many cases, serious medical issues arise after that, in older age. But even in the healthiest part of retirement,, better health clearly has an impact on most people’s ability to fully enjoy retirement”said Mathew Greenwald, president of Greenwald & Associates. “Many of these issues will only be exacerbated for retirees as they age, which puts an exclamation point on the importance of wellness.”
In examining health issues, the study found significant differences between retirees in excellent or good health and those in good or poor health in terms of lifestyle, enjoyment, and financial and emotional well-being.
The study showed that retirees in better health were more likely to engage in activities such as travel, exercise and recreation and hobbies. They were also more likely to attend sporting and entertainment events and spend time with family and friends.
“MassMutual continues to study issues impacting retirees and pre-retirees as part of our broader efforts to help Americans to retire on their own terms,” Sarsynski said. “We are applying our learnings from our research to help educate our retirement plan sponsors and participants on how best to prepare for retirement and make good planning decisions.”
The study, Health, Wealth and Happiness in Retirement, is part of a larger research project conducted in 2014 that surveyed 905 retirees who were one to 15 years into retirement. Respondents were required to be at least 40 years old, have at least $50,000 in savings and investments, and at least share a role in the household’s financial decision-making. The margin of error is plus or minus 2 percent.
For more information about MassMutual’s Retirement Services Division, please contact your financial professional or call MassMutual at 1-800-874-2502, option 4.
Founded in 1851, MassMutual is a leading mutual life insurance company that is run for the benefit of its members and participating policyowners. The company has a long history of financial strength and strong performance, and although dividends are not guaranteed, MassMutual has paid dividends to eligible participating policyowners consistently since the 1860s. With whole life insurance as its foundation, MassMutual provides products to help meet the financial needs of clients, such as life insurance, disability income insurance, long term care insurance, retirement/401(k) plan services, and annuities. In addition, the company’s strong and growing network of financial professionals helps clients make good financial decisions for the long-term.
MassMutual Financial Group is a marketing name for Massachusetts Mutual Life Insurance Company (MassMutual) and its affiliated companies and sales representatives. MassMutual is headquartered in Springfield, Massachusetts and its major affiliates include: Babson Capital Management LLC; Baring Asset Management Limited; Cornerstone Real Estate Advisers LLC; The First Mercantile Trust Company; MassMutual International LLC; MML Investors Services, LLC, Member FINRA and SIPC; OppenheimerFunds, Inc.; and The MassMutual Trust Company, FSB.
MassMutual’s Retirement Services Division has been serving retirement plans for more than 65 years. It offers a full range of products and services for corporate, union, nonprofit and governmental employers' defined benefit, defined contribution and nonqualified deferred compensation plans. It serves approximately 2.8 million participants.