In Profile: Dana Tatro

The Demographics of Well-Being

by Carolyn Ellis, Features Editor

Dana Tatro is senior vice president of product management in the U.S. Insurance Group at MassMutual. He brings a deep interest in demographic trends to his oversight of all MassMutual’s US-based individual products. With 25 years’ experience in insurance and annuity products, his focus is on the challenge of incorporating ever-changing generational statistics into the process of risk-management. We talked with Dana about MassMutual’s recently published Financial Resiliency Research Survey. Released in January 2015 it identifies both a developing confidence in overall retirement-readiness and an emerging gender-gap with regard to the perceptions of financial security.

L&HA: What is financial resilience?
Financial resilience is the ability to sustain one’s balance while going through the unexpected opportunities and obstacles that life tosses your way, whether they are personal, like a lost job, divorce, or health issue; or more widespread, like a financial crisis.

L&HA: What are the key findings of the MassMutual Financial Resiliency Survey?
: The research survey revealed that 70% of Americans feel they are better off financially now than they were three years ago. More than four out of five Americans have taken steps to build a strong financial plan. Those steps include putting money into a savings account (58%), learning from mistakes as they go along (53%), and contributing to retirement savings (37%). Among those who felt they were worse off financially than they were three years ago about 40% of Millennials cited a lost job as a contributing factor and almost one third of Gen-Xers cited major repairs to their car. Almost a third of Baby Boomers incurred unexpected medical expenses, and about a quarter of retirees said losses to investments were a contributing factor.

L&HA: Did the findings show a difference by gender
: According to our respondents, men and women face different challenges. More men, nearly 25%, cited losing money on investments as contributing to feeling worse off financially than they were three years ago, while this applied to only 6% of women. Thirty-four percent of women (vs. 25% of men) cited a lost job as contributing to feeling worse off financially, and 30% of men (vs. 24% of women) cited a medical expense.

L&HA: What are the implications of survey findings for agents and advisors?
: This particular research study underscores the value that agents and advisors deliver, and the opportunity and responsibility they have to speak with their clients about financial preparedness for life’s unexpected twists and turns. It’s important for agents and advisors to note that 6 in 10 retirees who were most satisfied with their situation worked with a financial advisor before retirement.

L&HA: How does the Financial Resiliency Survey fit into MassMutual’s wider research efforts?
: We’re in business to help people secure their future and protect the ones they love. The journey is not simple, however. We need to keep our finger on the pulse of so many things – the global society at large, market developments, technology advancements, healthcare changes, our customers of today and tomorrow, and so much more. Taking a pulse on various topics through research studies of the American population is one of many methods to fuel our insight.

L&HA: With your experience and passion for tracking demographic trends, what is most notable?
: I’d like to call attention to two interesting dynamics revealed in this study: men vs. women, and the Hispanic vs. general population. Men have more confidence in the current state of their finances than women: 75% of men feel they are better off financially than they were three years ago, while just 66% of women share this feeling. More surprising, women are more likely to not have taken any steps at all to build a resilient financial plan: one in five women do not have a plan to bounce back from financial challenges, compared to just 13% of men who do not have a plan.

Even more alarming, nearly three-quarters (71%) of women have not contributed to a retirement fund, which is one of many simple steps that can be taken to ensure financial resiliency. Similar to the general population, Hispanics feel optimistic about their financial state, but compared to the rest of the population, Hispanics are less prepared to weather long-term financial challenges. Yet, while Hispanics are just as likely to have taken steps to prepare for unexpected financial challenges as the rest of the population, they are behind the curve when it comes to one critical action for long-term financial resiliency: fewer Hispanics (26%) have contributed to a retirement fund than has the rest of the population (39%).

L&HA: Will today’s rising generations be able to create a secure financial for themselves and their families? Do they see that as a worthwhile goal?
Today’s younger generation absolutely has the opportunity for a secure financial future for several reasons. They have the advantage of experience from older generations and time to build a strong financial foundation if they take thoughtful steps and make sound decisions. One of the most powerful advantages for younger generations is time and the value of compounding. Taking personal accountability for their current and future financial state and making the right sustainable steps today can serve them very well for life’s unexpected twists and turns and far into the future.

L&HA: Is there any evidence that consumers are coping with financial anxiety?
A MassMutual study of retirees conducted in 2014 found a strong relationship between happiness and planning. Those who expressed the highest levels of satisfaction are also those who took concrete steps to put both their emotional and financial lives in order at least five years or more before retirement. In fact, those who took concrete financial steps such as calculating the best time to collect Social Security, targeting how much money they would need to afford retirement, and increasing savings reported feeling more financially secure in retirement. As I said earlier, retirees who were most satisfied with their situation worked with a financial advisor before retirement.

L&HA: What is the best way to motivate consumers of various demographics to build a resilient financial plan?
Let’s face it. Some people are planners, but the majority of the population likely is not. For them, possibly the biggest motivator is personal experience. If you, a loved one, or other respected entity in your life experiences something that impacts your life in a positive or negative way, it catches your attention. Research studies such as MassMutual’s financial resilience study are meant to either add another layer of substance or to fill a void to share personal beliefs and experiences of others like you. The end goal is to help others build knowledge, make sound decisions, and take tangible, sustainable steps toward protecting and securing their future.

L&HA: What might be the most important takeaway from the Financial Resiliency Survey?
: There is still room for improvement in Americans’ long-term financial planning. In fact, 17% of respondents to the financial resilience survey indicated that they had no plan targeted towards financial resiliency. Additionally, in contrast to five years ago when Americans were struggling to find any excess cash, our study indicates Americans’ finances have improved and can likely accommodate contributions to retirement accounts such as 401(k)’s, IRAs and annuities. Looking down the road even further, it is necessary to consider plans that address issues that further complicate retirement, such as longevity.