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September 29, 2009 at 08:00 PM
American families are reporting an increased desire for financial protection in these times of economic crisis, but do not have the proper financial strategy in place to fund their families’ future, according to a new survey of 1,105 respondents from New York Life Insurance Company and Ipsos Research.
According to the survey, released on Sept. 23, 83% of Americans age 30 and older agree that the economic crisis has increased their desire to provide financial protection for their family. Adults aged 30 to 49 (88%) and parents with children under 18 (88%) are particularly likely to have this desire.
While more than 8 in 10 adults age 30 and older report an increased desire to protect their families’ financial future, more than half of those surveyed would rely on their retirement savings, borrowing from family or getting another job if faced with financial hardship as the result of the loss of a breadwinner. Only about one-third identified life insurance as the answer to meet their financial needs in these circumstances.
“The economic crisis has been a wake-up call for families and most are seriously concerned about protecting their loved ones, yet many still lack a secure plan to do so,” said Mark Pfaff, executive vice president of U.S. Life and Agency, New York Life. “The solutions that many Americans would turn to in a crisis, including depleting retirement savings and taking an additional job, would require painful and difficult choices with serious repercussions for the family. These findings show that there is more work to be done to educate families about how life insurance helps to provide peace of mind and future financial well-being for loved ones.”
When asked what would primarily fund the family’s future financial goals if something were to happen to the breadwinner, nearly a quarter said that they would take an additional job (22%) or draw down their retirement savings (22%). Another 7% said they would seek the help of family and friends, and 1% even said they would hope to win the lottery. Only 32% of Americans said that they would primarily rely on life insurance to help finance their families’ future. One in six (16%) wouldn’t look to any of these options as the main source of funding for their family’s financial goals.
“The survey findings are compelling because for over a year now Americans have been coping with increasing unemployment and dizzying stock market fluctuations, but this hasn’t deterred consumers from a fundamental belief in protecting their families. In fact, it seems to have heightened their focus on creating financial security for their family,” said Nicolas Boyon, senior vice president with Ipsos Public Affairs, who conducted the study.
