Last year brought the first full year of living with a pandemic as economic productivity bounced between recovery and slowdown, and with a changing job market and historic inflation, the focus of retirement income has shifted for many.

A report done mid-2021 found that 35% of workers had either changed or considered changing when they would retire due to the effects of the pandemic, writes the Society of Actuaries. Most have extended their retirement date out, and the younger generations reported concerns about the lasting impacts the pandemic will have on their retirement savings.

The pandemic has had a very real impact on the job market, with 40% of Millennials (born between 1980-1998), 33% of Gen Xers (born between 1965-1979), and 21% of “Late Boomers” (born between 1955-1964) in the survey reporting either a reduction in pay or loss of their job.

COVID-19 has also heavily impacted minority populations, with three in 10 Black Americans/African Americans reconsidering when they will be able to retire, and four in 10 of both Asian American and Hispanic/Latino American respondents also reconsidering their retirement, per a different survey from the Society of Actuaries.

Pandemic impacts have been felt disproportionately, with those more likely to be financially fragile bearing the brunt of the costs, changes to financial priorities, and changes to planning behaviors for those most impacted. These groups include Millennials, Gen Xers, women, individuals who are unmarried or divorced, and lower-income individuals with less savings, according to a financial fragility survey from the Society of Actuaries.

This all adds up to large percentages of the population who are left reconsidering their retirement and retirement planning as the pandemic continues into 2022.

An Industry Refocus on Income in Retirement

Whereas Social Security benefits and defined-benefit plans always highlighted income as the priority, 401(k) plans up until last year were primarily focused on assets instead of the income they would net, reports MarketWatch. The goal of a 401(k) was arguably in asset accumulation and growing that amount ever larger, versus focusing on the income being generated by those assets.

The change to focusing on income within those retirement contribution plans was boosted by the passage of the SECURE Act that required 401(k)s and similar plans to provide in plain text the estimated lifetime income from the plan, as well as several new funds coming to market focused on providing income, believes Arun Muralidhar, founder of AlphaEngine Global Investment Solutions.

“At a high-level theme, it is the recognition in the industry that for defined-contribution plans, retirement income — as opposed to assets under management in your retirement account — is what should be focused and reported on,” Muralidhar said.

This refocus could help working Americans more easily envision what their retirement actually looks like, and help plan more efficiently in challenging times with changing priorities. Nationwide offers a variety of actively managed ETFs for advisors that cater to a range of investment exposures and strategies for those seeking retirement income options for their clients.

For more news, information, and strategy, visit the Retirement Income Channel.