New York Life | May 26, 2020
NEW YORK - Money is an inherently emotional topic for many Americans, a phenomenon the COVID-19 pandemic has only amplified. According to new data from New York Life, Americans are experiencing a wide range of emotions, with many experiencing negative and positive emotions in equal measure – an ambivalence that’s also reflected in perceptions of their finances.
In order to better understand how people in the U.S. are experiencing the emotional and financial impacts of the COVID-19 pandemic, New York Life asked 2,200 adults in late March and again in early April, a range of questions about how their emotions connect to their financial outlook.
When U.S. adults were asked how strongly they were feeling certain emotions, half of respondents report feeling scared and about two-thirds say they have felt loved. In addition, more than half say they have felt hopeful. Unsurprisingly, the data reveals that positive feelings are linked to long-term financial confidence: 56% of people who say they feel hopeful are also confident that their retirement savings can last for the rest of their life. But even the hopeful are feeling near-term anxiety, with the survey finding they are 9% more likely to report less confidence than more confidence in their savings compared to the prior month.
“COVID-19 has impacted absolutely every aspect of our lives and our research shows that Americans are anxious and hopeful in equal measure and these emotions are coloring how they feel about their finances. Emotions often influence finances, but especially in times like these, it can be extraordinarily difficult to separate your emotions from your financial decision-making,” said Aaron Ball, Senior Vice President and Head of Insurance Solutions at New York Life. “The key is to stay focused on what you can do now to protect the health, safety and financial future of yourself and your loved ones and to seek help from a trusted professional to develop a plan.”
Additional findings from New York Life’s survey include:
Boomers feel secure in their future, but not their present. About half of the Baby Boomers surveyed in both late March (47%) and early April (53%) express confidence that their retirement savings will last the rest of their lives. At the same time, however, Boomers are the least confident generation when it comes to the status of their savings overall, with 39% feeling less confident in March than in February, and 40% feeling less confident in April than in March.
Said Dylan Huang, Senior Vice President and Head of Retail Annuities at New York Life, “This split between near-term anxiety and long-term confidence seems contradictory, but it reveals that a plan can make all the difference. While COVID-19 is undoubtedly impacting how much individuals can save for retirement right now, it can also be an opportunity to ensure that you have a plan that includes enough protection to help you weather unexpected shocks alongside opportunities for continued growth.”
Coronavirus squeezes the Sandwich Generation further. About one-third of Gen Xers feel they’re more likely to have to care for an aging parent as a result of the coronavirus outbreak – a number that’s grown from 27% in late March to 34% in early April. But this generation may not be prepared for the responsibility, with just 39% expressing confidence in their ability to care for an aging parent.
Added Ball, “The coronavirus pandemic has required all of us to re-evaluate our priorities and now more than ever we are seeing caregiving rise to the top of the list. Although Gen X is feeling the impact of caregiving responsibilities, they are increasingly confident about their longer-term economic outlook and are likely to update their financial plans as a result of what they are currently experiencing.”
New York Life commissioned Morning Consult to conduct two surveys among a national sample of 2,200 adults. The surveys, fielded first March 23-24, 2020, and again April 9-10, 2020, were conducted online and the data were weighted to approximate a target sample of adults based on age, educational attainment, gender, race, and region. Results from the full survey have a margin of error of plus or minus 2 percentage points.
New York Life Insurance Company (www.newyorklife.com), a Fortune 100 company founded in 1845, is the largest mutual life insurance company in the United States* and one of the largest life insurers in the world. Headquartered in New York City, New York Life’s family of companies offers life insurance, retirement income, investments and long-term care insurance. New York Life has the highest financial strength ratings currently awarded to any U.S. life insurer from all four of the major credit rating agencies**.
*Based on revenue as reported by “Fortune 500 ranked within Industries, Insurance: Life, Health (Mutual),” Fortune magazine, 5/18/20. For methodology, please see http://fortune.com/fortune500/.
**Individual independent rating agency commentary as of 9/12/19: A.M. Best (A++), Fitch (AAA), Moody’s Investors Service (Aaa), Standard & Poor’s (AA+).
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