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The Boomer Opportunity: Tapping the Expertise of the MetLife Mature Market Institute®

Barbara HowardGerontology ConsultantMetLife Mature Market InstituteMay 2006

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“I get the ‘boomer’ part but I don’t get the ‘baby’ part.”

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MetLife’s comprehensive resource on aging, retirement, and long-term care for MetLife and its business partners.

•Research & Polls•Public Education & Policy•Facts, Stats, Information•Training & Education•Consultation

www.maturemarketinstitute.com

Mature Market Institute

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Media Leadership

• The Mature Market Institute positioned to provide Thought Leadership for MetLife

• Sponsored Retirement Income IQ media event to dispel myths and misconceptions about annuities

• Sponsored Long-Term Care IQ media event to dispel myths and misconceptions about long-term care

• Expert resource to major media resulting in coverage in the Wall Street Journal, the New York Times, CNN, ABC World News Tonight, and USA Today.

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Today’s Presentation

Demographic ProfileLife Stages and BehaviorsRetirement and BeyondHow the MMI can help you

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Meanwhile, outside the park

Two Stones tickets please, Senior Discount

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0.00.51.0

1.52.02.53.03.5

4.04.55.0

5 15 25 35 45 55 65 75 85 95 100+

Millions

Age

BabyBoomers

Baby BoomersAs of 2006

Source: MetLife Mature Market Institute AnalysisPopulation Projections ProgramUS Census Bureau, 2000

Boomers are getting older …

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Boomers Have Unique Characteristics

Working WomenMore Education

Health/Wellness

Personal Growth Involvement And

ActivismSpenders not Savers

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Boomer Formative Years

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Longevity…The Greatest Risk

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Longevity “IQ” Low

An individual who reaches age 65 has a life expectancy of age 85. What are the chances he or she will live beyond that age?

a) 0

b) 25%

c) 50%

d) 100%

Source: MetLife Retirement Income Survey, 2003

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How do Boomers Feel about Retirement?

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Boomers are Anxious About Retirement

• The number of boomers worried about retirement has almost doubled in four years.

• Younger boomers (41-49) are more likely to worry about retirement than older boomers (50-59) 39% vs. 30%

49%40%

19%

33%

LookForward toRetirement

Worry AboutRetirement

20012005

Source: The MetLife Survey of American Attitudes Toward Retirement: What’s Changed?, October 2005

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And Are Unwilling to Spend Less to Leave

an Inheritance

9%

23%

24%

42%

6%

14%

22%

52%

0% 10% 20% 30% 40% 50% 60%

Very Likely

SomewhatLikely

SomewhatUnlikely

Very Unlikely

20052001

Likelihood of Spending Less in Retirement to Leave Money for Others

Source: The MetLife Study of American Attitudes Toward Retirement: What’s Changed? October 2005

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Many Plan to Keep Working…50% 48%

43%

29%

7%

23%

0%5%

10%15%20%25%30%35%40%45%50%

Yes No Unsure

20012005

Source: The MetLife Study of American Attitudes Toward Retirement: What’s Changed? October 2005

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To Keep Active and for Financial Reasons

42%

19%

17%

17%

69%

44%

30%

23%

0% 20% 40% 60% 80%

Want to KeepActive

Need Income

MaintainLifestyle

Want extras

20052001

Source: The MetLife Study of American Attitudes Toward Retirement: What’s Changed? October 2005

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Aging and Disability

Disabilities over Age 65 Prevalence of Alzheimer’s Disease

Source: U.S. Dept. of Health & Human Services, July 2002

Source: Survey of Income and Program Participation, U.S.Census Bureau, March 2001

54.5%

37.6%

16.7%

0.0%

10.0%

20.0%

30.0%

40.0%

50.0%

60.0%

% With AnyDisability

% With SevereDisability

% Need Assistance

47%

19%

3%

0%5%

10%15%20%25%30%35%40%45%50%

65-74 75-84 85+

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Perspectives on Caregiving and Long-Term Care

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“There are only four kinds of people in this world ...

Those who have been caregiversThose who currently are caregiversThose who will be caregiversThose who will need caregivers.”

Rosalynn Carter, 1997

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Women are working More divorces Fewer or no children Geographic separation Care recipients living

longer

Family Structures Have Changed

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44.4M Caregivers46 Average Age of Caregiver61% Women4.3 Average Length of Care (Years)59% Employed

Source: Caregiving in The U.S. , National Alliance for Caregiving & AARP, April 2004

Caregiver Profile

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•Annual Market Survey of Nursing Home, Home Care, and Assisted Living Costs

•Covers 87 major markets

Source: The MetLife Market Survey of Nursing Home & Home Care Costs, 2005, The MetLife Market Survey of Assisted Living Costs, 2005

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2005 Major Findings•National average for a private room in a nursing home

•$203/day or $74,095 annually

•National average for a semi-private room in a nursing home•$176/day or $64,240 annually

•National average for a private room in an assisted Living facility

•$2,905/month or $34,860 annually

•Average hourly rate for Home Health Aid•$19/hour

•Average hourly rate for Homemaker/companion•$17/hour

Source: The MetLife Market Survey of Nursing Home & Home Care Costs, 2005, The MetLife Market Survey of Assisted Living Costs, 2005

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•First major study of long-distance caregiving since 1997

•Exclusive coverage in the Wall Street Journal and reported in major national media

Source: Miles Away: The MetLife Study of Long-Distance Caregiving, 2004

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Miles AwayMajor Findings

•Caregivers live an average of 450 miles from care recipient and spend $392 monthly on travel and out-of-pocket expenses

•80% work either full or part-time

•44% rearrange work schedules

•36% miss days of work

•12% took a leave of absenceSource: Miles Away: The MetLife Study of Long-Distance Caregiving, 2004

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Sons at WorkBalancing Employment and Eldercare

• Men are just as likely as women to be the primary caregiver

• Women perform more personal tasks than men

• Both men and women have little knowledge about company-sponsored programs

Source: The MetLife Study of Sons at Work, 2003

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Study of Employed Caregivers: Does LTCI Make a Difference?

Employed caregivers of elders with LTCI are nearly twice as likely to stay in the workforce and have fewer social stresses

Source: The MetLife Study of Employed Caregivers: Does Long Term Care Insurance Make a Difference, 2001

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Retirement Looming on The Horizon

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Savings Rates Low

Decreasing DB Plans

Elimination of Retiree Health

Benefits

Rising Cost of Health Care

Rising Cost of LTC

Few are Planning

Underestimate Longevity

The Approaching Storm

Uncertainty of Entitlements

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Less than $25K$25K - $49,999$50K - $99,999$100K - $249,999$250K+

Retirement ReadinessBad News Savings Rates are Low

AllWorkers

5312121112

Ages25-34

7311745

Ages35-44

491416129

Ages45-54

4314121416

Ages55+438

121126

L0408JHEC(0807)MLIC-LDAll figures are percentages. Source: EBRI, The 2006 Retirement Confidence Survey

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Workers with Pension Coverage By Type Of Plan

0

10

20

30

40

50

60

Traditional DefinedBenefit Plan Only

Defined Contribution-401(k)-Only

Both

1981 1991 2001Source: U.S.Department of Labor (2002) and authors estimates based on Board of Governors, Survey of Consumer Finances (2001). From EBRI Issue Brief, January 2005

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Retirement – Ready or Not?

If we take a late retirement and an early death, we’ll just squeak by.

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Progress Toward Retirement Savings Goals

3%

24%

23%

22%

19%

9%

Already achievedgoals

On track for reachinggoals

Somewhat behind

Significantly behind

Haven't started

Don't have goals

Employee Perceptions of Progress Toward Retirement Savings Goals

Source: MetLife Employee Benefit Trends Study - 2004

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Another Way to Look at It

Source: AARP, Boomers Approaching Midlife: How Secure a Future:, 1998

20% Financially Secure$75,000+ income adequate savings

55%Caught in the Middle$25,000 - $75,000 incomeSome savings

25% Financially Vulnerable$25,000 or less income No savings

AARP, Boomers Approaching Midlife: How Secure a Future - 1998

Baby Boomer Finances

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Glass Half Empty….Or Half Full

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Boomer Window of Opportunity

Not yet retired Better educated Healthier Interested in second careers Not as concerned with leaving an inheritance Assets in homes Open to advice and assistance

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Longevity Basics First

Income for life Provide for spouse/dependents Long-term care protection Health care coverage Legacy

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The New Face of Aging

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Barbara HowardMetLife Mature Market Institute

57 Greens Farms RoadWestport, CT 06880

(203) 454-5392Website

www.maturemarketinstitute.com

Metropolitan Life Insurance Company, New York, NYL06019SOI(exp0108)MLIC-LD