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Most Americans are Keeping a Long-Term View on Their Investments, Despite Market Uncertainty

86% believe ‘staying the course’ is important

A new Voya survey reveals how consumers look at the COVID-19 pandemic concern with regard to the world, economy and their own personal finance situations

Voya Financial, Inc. (NYSE: VOYA) announced today findings from a new consumer survey, which reveals that while the majority of Americans feel nervous (71%) about their finances during this volatile time, most individuals (86%) feel that “staying the course” and having a long-term view on their investments (85%) is important.

This is noticeably higher among those who were working with a professional financial advisor (96%) and those who participate in a retirement savings plan (93%), thus suggesting the value and education that advisors provide today as well as the benefits that many see in participating in a workplace savings plan, having an investment plan and understanding the importance of maintaining a long-term view.

Standing Pat

“While fluctuating markets and the uncharted waters of today are clearly creating concern and anxiety for most, we are extremely encouraged to see that, so far, individuals are sticking with their long-term investment strategy,” said Charlie Nelson, chief executive officer, Retirement and Employee Benefits, Voya Financial. “We’re seeing this with our own plan participants as well. For example, while the market volatility has been unprecedented this year, the number of participants moving money between funds in a retirement plan is still very low. Less than 3% of Voya’s total retirement plan participant base made a trade in their account during the first quarter of 2020, indicating that 97% of our participants have stayed the course thus far. In addition, just 2.1% of participants made a change to their future investment elections in the first quarter of 2020, compared with 1.3% in the first quarter of 2019.”1

Voya’s survey, which offers several new insights about how Americans are feeling about their personal finances and market uncertainty in the wake of the COVID-19 (Coronavirus) pandemic, also found that the majority of individuals feel the pandemic poses a greater threat to the economy (75%) than to themselves personally (28%).

we are extremely encouraged to see that, so far, individuals are sticking with their long-term investment strategy...

From a generational standpoint, continuing retirement plan contributions was seen as more important to younger consumers as 80% and 79% of those ages 18–34 and 35–54, respectively, said it was either “extremely important” or “important” to contribute to their retirement plan. This compares to 66% for those age 55 and over. When it comes to gender, women were also more likely (90%) than men (81%) to “stay the course.”

Having ‘Less Control’

“We know the unpredictability of the COVID-19 situation is driving concerns about the economy and also making people feel like they have less control over their finances,” said Nelson. “We also know that there are many who may have no choice but to draw on their retirement savings to meet financial challenges, which is why we recently announced several actions to help Americans address COVID-19-related challenges. For Voya defined contribution plan participants, these efforts include crediting back: fees associated with coronavirus-related distributions (CRDs) allowed under the CARES Act; hardship distribution fees; and loan initiation fees. Voya is also providing free access to educational guidance, including a range of online resources and phone access with financial professionals through Voya Financial Advisors*.”

“Ultimately, we believe it’s important for individuals to generally, have a plan and not make unwarranted changes, to stay invested, and continue to contribute to their retirement plan so they can save for the future and achieve their broader financial wellness goals,” added Nelson.

As an industry leader and advocate for greater retirement readiness, Voya Financial is committed to delivering on its vision to be America’s Retirement Company® and its mission to make a secure financial future possible — one person, one family, one institution at a time.

All data outlined in this release, unless noted otherwise, is based on the results of a Voya Financial survey conducted through Ipsos March 25-26, 2020, on the Ipsos eNation omnibus online platform among 1,000 adults aged 18+ in the U.S.

 

 

 

1. Voya’s retirement plan participant data; Year over Year (Jan. 1, 2019 – March 31, 2019; Jan. 1, 2020 – March 31, 2020).
*Registered Representatives of Voya Financial Advisors, Inc. (member SIPC)