Skip navigation.
Go to the Principal Financial Group(R) home page
Secure  Account Login

Select login type:


Well-Being Index
Quick Links
Tools

The Principal Financial Well-Being IndexSM Summary 2nd Quarter 2011

This Principal Financial Well-Being IndexSM survey was conducted online within the United States by Harris Interactive on behalf of the Principal Financial Group® between April 28 and May 9, 2011 among 1,134 employees and 523 retirees. This is one in a series of quarterly studies to identify and track changes in the workplace of small and mid-sized (growing) businesses. The first Principal Financial Well-Being IndexSM survey was conducted in the United States in 2000.

Employees consisted of adults 18+ who work at small and mid-sized (SMB) U.S. businesses (firm size 10-1,000 employees). Retirees consisted of adults age 60+ who reported they are retired or those who are employed part-time or self-employed and have retired from a previous career. Results were weighted as needed for age by gender, education, race/ethnicity, region and household income. Propensity score weighting was also used to adjust for respondents’ propensity to be online.

All sample surveys and polls, whether or not they use probability sampling, are subject to multiple sources of error which are most often not possible to quantify or estimate, including sampling error, coverage error, error associated with nonresponse, error associated with question wording and response options, and post-survey weighting and adjustments. Therefore, Harris Interactive avoids the words “margin of error” as they are misleading. All that can be calculated are different possible sampling errors with different probabilities for pure, unweighted, random samples with 100% response rates. These are only theoretical because no published polls come close to this ideal.

Respondents for this survey were selected from among those who have agreed to participate in Harris Interactive surveys. The data have been weighted to reflect the composition of the entire population of adult employees working for small to mid-sized U.S. businesses and retirees. Because the sample is based on those who agreed to be invited to participate in the Harris Interactive online research panel, no estimates of theoretical sampling error can be calculated.

Download the Full Report (PDF: 156 KB) - includes all questions and data

Featured Key Findings

  • Financial Well Being –
    • Three out of five employees (63%) are very concerned with their long-term financial future, while significantly fewer retirees are concerned with their long-term financial future (43%) than last quarter (54%).
    • Two out of five retirees (41%) are extremely happy about their current financial well being compared to significantly fewer employees (27%).
      • Employees who use a financial advisor for financial advice, guidance, and/or products for a fee or commission are significantly more likely to report they are extremely happy with their current financial well being (42%) than employees who do not use a financial advisor (22%)
    • Just about a quarter of employees (24%) have not yet planned for retirement savings/security.
      • Employees who do not use a financial advisor are significantly more likely to have not yet planned for retirement savings/security (28%) than employees who do use a financial advisor (12%).
  • Economic Outlook –
    • When asked how they would describe their sentiment regarding the economic outlook for 2011, approximately half of both employees (48%) and retirees (53%) selected “cautious”.
  • Impediments to Financial Success –
    • Just under half of employees (46%) said not saving enough gets in the way of their financial success. Over a quarter chose credit card/other consumer debt (29%) or not starting retirement savings early in their career (27%).
      • Employees who use an advisor are more likely to indicate that being overly conservative in investments and investing when the market is high get in the way of their financial success. Employees who do not use a financial advisor are more likely to indicate that not saving enough, credit card/other consumer debt, impulse purchases and living beyond their means get in the way of their personal financial success.
    • Retirees were also most likely to choose not saving enough as a factor that gets in the way of their personal financial success, with a third selecting this option.
  • American Dream –
    • Three out of five employees (61%) agree it has been or will be harder to achieve the American dream than it was for their parents’ generation compared to less than half of the retirees (44%). Significantly more employees this year compared to last year (61% versus 56% in 2010) agree that it will be harder to financially achieve the American Dream than it was for their parent’s generation.
      • Employees who do not use a financial advisor are significantly more likely to agree that the American dream will be harder for them to achieve financially than it was for their parents’ generation (65%) compared to employees who do use a financial advisor (51%).
  • Financial Dreams –
    • Over a third of employees (36%) and two out of five retirees said they are confident, very confident or extremely confident in their ability to achieve their dreams for their financial future.
      • Employees who use an advisor were significantly more likely to be confident, very confident or extremely confident in their ability to achieve their dreams for their financial future (46%) than employees who do not use an advisor (32%).
    • At least one out of five employees (range 23% - 33%) indicated it is difficult for them to visualize their financial dreams for all the future timeframes presented to them. A third of employees said it is difficult for them to visualize their financial dreams for their retirement.
    • The top financial dream for both employees (22%) and retirees (21%) is to be financially secure.
  • Financial Advisor Usage –
    • A quarter of employees and a third of retirees (35%) indicate they use an advisor who provides them financial advice, guidance, and/or products for a fee or commission.
    • Over a quarter of employees and retirees (27%) who do not currently use a financial advisor think they would need $100,000 or more in savings or investments in order to feel comfortable using an advisor.
    • Employees are most likely to not use a financial advisor because they do not think they have enough savings or investments (27%), they do not want to pay a fee (20%) or they do not trust financial professionals (14%). Retirees were most likely to not use financial advisors because they do not think they have enough savings or investments (39%), they know enough on their own (18%) or they do not trust them (12%).
  • Summer Vacation Plans –
    • Nearly a third of retirees (32%) and two out of five employees have not changed their summer vacation plans in order to save money. A third of employees (35%) and a quarter (26%) of retirees have altered their vacation plans to save money.
    • For employees and retirees, rising fuel prices was the top fear that could potentially impact their summer vacation plans, selected by three out of five employees and two-thirds of the retirees (65%), both up significantly from 2nd quarter of 2010.
    • Over a third of employees (38% versus 25% of retirees) are either considering a staycation (25%) or are definitely taking a staycation (13%) this summer in order to save money.
  • Factors Potentially Impacting Summer Vacation

  • Rising Fuel and Food Prices –
    • About three quarters of employees (74%) and slightly fewer retirees (71%) rated their level of concern with rising fuel prices as either extremely concerned or very concerned. Approximately three out of five employees (59%) and retirees (61%) rated their level of concern with rising grocery/food prices as either very concerned or extremely concerned.
    • To compensate for rising fuel costs, nearly three out of five employees (58%) and nearly two-thirds of retirees (63%) indicate they are driving less. A third of employees and retirees (32%) also reported they have reduced their spending on basic necessities.
    • Approximately half of employees and retirees have been purchasing store or generic brands (48% employees; 56% retirees), going out to eat less (48% employees; 45% retirees) and clipping coupons more (47% employees; 54% retirees) in order to deal with recent increases in grocery prices.
  • Employee Benefits –
    • Employees continue to rate health insurance as the most important benefit, followed by defined contribution retirement plans and dental insurance. Health insurance is the benefit most employees would like to see improved, while defined benefit plans is the benefit most employees would like to see their employer offer.
  • Actual Experience in Retirement Compared to Expectations for Retirement –
    • About half of retirees (47%) said retirement has actually been about what they expected in terms of expenses. Another 46% of retirees said retirement has actually been more expensive than they expected it to be (31% more expensive; 15% much more expensive).
    • For level of personal fulfillment in retirement, 46% of retirees said retirement has been about what they expected it to be. One in five retirees said retirement has been more fulfilling than what they expected while a third of retirees said retirement has been less fulfilling than they thought it would be.

Have a question? Call us at 1.800.986.3343

Copyright © , Principal Financial Services, Inc.
Disclosures and Terms of Use | Products and Services Disclosures | Privacy and Security
Securities offered through Princor Financial Services Corporation, member SIPC