Research Shows Need for Financial Wellness InitiativesDecember 1, 2016 | Research
In a recent OneAmerica survey, we asked retirement plan participants to self-identify their levels of knowledge across 10 retirement and personal finance-related topics. According to the survey results, the overall level of personal financial knowledge among participants is low. Only 40 percent of participants consider themselves either knowledgeable or very knowledgeable about retirement savings, specifically.
Although the survey data suggests that men have more confidence than women in their financial knowledge base, the overall lack of financial knowledge self-reported by survey participants could have significant implications. A lack of general financial knowledge can often lead to under use of retirement plan benefits. When people fully comprehend their options, they are more likely to act. One of the most troubling findings involves compounding. Only 36 percent of men and 18 percent of women knew how compounding affects retirement accounts. This is bothersome because understanding the power of compounding can bring hope and motivation. If these respondents don't understand how compounding works, they may feel hopeless.
Are you interested in learning more about compounding and other financial concepts? Visit our YouTube channel for a variety of Pete the Planner videos about these topics and more.