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As markets settle from initial COVID-19-related health and economic crises, Americans are evaluating the damage and reassessing their market volatility threshold. According to new findings from the Q3 Quarterly Market Perceptions Study from Allianz Life Insurance Company of North America (Allianz Life) fewer people express concern over a coming recession than they did last quarter (57% compared with 65%), though the number is still higher than it was for all of 2019.


While immediate panic seems to have died down, people are still feeling the various health, social and economic effects of the pandemic and learning how these risks are affecting their financial situation.


According to the study, over one-third (34%) of Americans do not feel financially prepared to ride out the economic impacts of COVID-19, and more than half (53%) say the pandemic is having a negative impact on their retirement plans.


“After the initial shock of the health crisis and related market downturn earlier this year, Americans seem to be coming to terms with all the ways the pandemic is impacting their lives,” said Kelly LaVigne, Vice President of Consumer Insights, Allianz Life. “Now may be a good time for people to review their finances, including how to protect retirement assets from whatever the market may do as we head toward the election and the end of the year.”


As such, over half of all Americans (52%) say they regret not having more of their savings protected from market loss. This may be leading to an increased interest in financial protection products, like annuities.


The study found 64% of people say it’s important to have some retirement savings in a financial product that protects from market loss. At the same time, the number of people who say they are willing to give up some potential gains in exchange for a product that protects a portion of their retirement savings from loss has been steadily increasing since the start of the year (46% in Q3 compared with 45% in Q2 and 38% in Q1).


More specifically, nearly a quarter (23%) of people express interest in putting some money into a financial product with modest potential growth (2-3%) and no potential loss, the highest percentage in a year.


“This trend toward protection makes sense when you look at the economic and market environments since the beginning of the year,” added LaVigne. “When you also consider that no one is sure when the current economic and health crisis will end and the added uncertainty caused by the upcoming election, it’s logical that people want to mitigate some of that risk to their retirement savings, and add products that can help provide a level of protection.”


Allianz Life conducted an online survey, the 2020 Q3 Allianz Life Quarterly Market Perceptions Study, in August 2020, with a nationally representative sample of 1,004 respondents age 18+.


(Guarantees are backed by the financial strength and claims-paying ability of the issuing company.)