A new study by Security Benefit finds that educators prefer to learn how to manage their finances from financial advisors than from any other method
TOPEKA, Kan., June 21, 2022–(BUSINESS WIRE)–According to a new study by Security Benefit, a leading provider of retirement products and solutions in the K-12 education market, more than half (52%) of all educators would rather learn about managing their finances by a financial professional as opposed to other methods. Coupled with other findings, the first State of Teacher Finances survey underscores that the role of the financial advisor – particularly among younger audiences – remains crucial in helping teachers prepare for retirement and other financial goals help.
In-person/online courses (named by 36% of respondents), finance apps (33%), and friends and family (30%) were cited by educators as other preferred ways to learn about finance, although none approximately the case was preferred as well as financial advisors. The study, which focuses on the role of financial planning in educators’ financial futures, was conducted by Directions Research via a survey of 502 US adults over the age of 25 who are teachers or administrators in K-12 education.
“Educators have more tools than ever at their disposal to learn how to manage their finances, but there clearly continues to be a preference for the professional advisor,” said David Byrnes, director of sales at Security Benefit. “Our survey found that educators are passionate about seeking and achieving financial security, but sometimes lack the tools to do so and seek advisors to guide them through this critical process.”
Millennial educators want consultants to do more
Of all the generations surveyed, millennials were found to be the most likely to be working with a financial advisor right now. Fifty-eight percent of Millennial educators reported engaging with a counselor, outperforming their Gen X (46%) and Baby Boomer (50%) peers. Millennials are keen to get help managing their finances, and nearly a quarter (23%) would like someone to fully manage their finances, compared to just 15% of Gen X respondents.
Social media channels are popular with younger educators – 23% of millennials said social media is among their top three favorite ways to learn about managing finances, compared to just 11% of the older respondents. Data from the survey also shows that educators (of all ages) who use a financial advisor are almost twice as receptive to learning about managing finances through social media than their peers who do not use an advisor. This signals an opportunity for financial advisors to reach their educational clients via social media in addition to traditional channels.
Educators point to the need for more resources for financial planning
Respondents were asked to select from three options (financial security, mental health, or physical fitness) where they needed help most to achieve their goals. 45 percent of respondents said they needed the most help to achieve financial security — more than double the number who said they needed the most help to achieve their mental health goals.
When asked what financial security means to them, the majority of respondents indicated short-term and long-term savings. Specifically, educators rated saving for retirement and having an emergency savings fund as the two most important areas that corresponded to their perception of what financial security means. In a worrying detail, however, 61% of baby boomers said saving for retirement is the area of financial literacy they need help with the most.
“Although saving for retirement has been ranked as the most important element of financial security, this is an area where even prospective retirees express a strong need for assistance,” said Jim Kiley, director of Eastern Sales at Security Benefit. “If advisors can reach educators earlier in their careers, they can help them be successful in retirement.”
Despite challenges, millennials are striving to retire earlier
Baby boomers have adjusted their retirement expectations as they grapple with their need for additional guidance on saving for retirement. Conversely, Millennials appear to be aiming for earlier retirement. 78% of millennials said they plan to retire by age 64, compared to just 20% of baby boomer respondents who said the same.
But while Millennials want to retire earlier, they are realizing that certain sources of income for retirement may not be as available to them as previous generations. Only 8% of Millennials expect Social Security to be their primary source of income for retirement, as opposed to 31% of Baby Boomers. And only 14% of millennial educators expect to be able to count on a pension, compared to 30% of their older peers. As such, taking an active approach to managing their finances with an advisor will be critical for younger generations to meet their retirement schedules and expectations.
This study was conducted online by Directions Research. It was conducted March 3-11, 2022 among 502 US adults age 25 and older who are educators or teachers in K-12 education.
Poll respondents were from people who chose to participate in polls and polls. Quality checks were performed to ensure data integrity, but all sample surveys are subject to multiple sources of error, such as B. Sampling error, coverage error, non-response bias and measurement error.
About the security benefit
Security Benefit Corporation (“Security Benefit”), through its subsidiary, Security Benefit Life Insurance Company (SBL), a Kansas-based insurance company that has been in business for 130 years, is a leader in the US annuity market. Security Benefit, along with its subsidiaries, offers products across a full range of fixed income markets and asset segments for employers and individuals and held $46.9 billion1 in assets under management as of December 31, 2021. Security Benefit, an Eldridge company, continues its mission to serve Americans To and through retirement®. Learn more at www.securitybenefit.com and follow us on LinkedIn, Facebook or Twitter.
About Directions Research
Directions Research has been independently recognized as one of the nation’s leading companies for business decision insights. Founded in 1988, Directions is a privately held company based in Cincinnati, Ohio with regional offices across the country and operations worldwide. It combines highly experienced people with a unique blend of innovative and proven approaches to solve pressing business problems. Directions is a member of the Insights Association and is committed to quality in all aspects of the research process.
Security Benefit Corporation and its affiliates are not trustees. This information is of a general nature and intended for the general public. For more information, including specific advice or recommendations, please consult your financial professional. Annuity guarantees are subject to the financial strength of the issuing insurance company. Annuities are not FDIC or NCUA/NCUSIF insured; are not obligations or deposits of, guaranteed or warranted by any bank, savings and loan association or credit union or any of their affiliates; and are not related to or a condition of the provision or duration of any banking service or activity. SBL is not licensed and does not conduct insurance business in the state of New York.
1 includes retained assets of $4.9 billion (including $3.2 billion of existing business as of January 1, 2021 and $1.7 billion of underwritten business in 2021) and assets of of USD 0.3 billion held pursuant to over-collateralization requirements as part of the reinsurance transaction with SkyRidgeRe Limited.
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Michael Castino, director of public relations, Security Benefit
Jake Daubenspeck, Senior Vice President, Prosek Partners