MINNEAPOLIS–(BUSINESS WIRE)–After a volatile year in the markets, American investors ended 2019 feeling more confident about their finances than they have in a long time. According to the latest Allianz Quarterly Market Perceptions Study from Allianz Life Insurance Company of North America (Allianz Life^®), worries about an impending market crash or recession are at their lowest levels since 2018.

In the fourth quarter, just 39% of respondents say they are worried about a big market crash on the horizon, and 43% say they are worried about a coming recession. These numbers had been steadily rising since 2018, before dropping after a relatively calm period in the markets in mid-November.

“Interestingly, despite this current sense of calm, the number of people who say now is a good time to invest in the market continues to decrease,” said Kelly LaVigne, vice president of consumer insights, Allianz Life. “This may be because people are anticipating more volatility in 2020, and don’t want to take the risks that those major swings can have on their savings and retirement.”

These underlying worries may be what’s driving a renewed interest in a product with guaranteed retirement income as a way to help mitigate the risks that market volatility can have on retirement. Nearly a third of respondents (31%) say putting some money into a financial product that provides a guaranteed stream of income in retirement is the most important step to take to help make sure they have a secure retirement. This is up from 26% last quarter.

Rising Inflation Risks

While people might be feeling better about reduced market risks to their retirement, risks from inflation are top of mind. Almost half (49%) of Americans say the rising cost of living is a big risk to their security in retirement, and over a third (34%) say that inflation may prevent them from ever being able to retire.

Those with the longest runway toward retirement, millennials, are most worried about the impact of rising costs, both now and in their future. They are more likely to say the rising cost of living is preventing them from saving money for retirement as much as they should (62%, compared with 56% of Gen Xers, and 42% of baby boomers). Millennials are also most worried about being able to pay for necessities like housing or medical care in retirement due to the rising cost of living (50%, compared with 46% of Gen Xers, and 35% of boomers).

“The rising cost of living is a real threat to hard-earned retirement savings, particularly as people are spending more time in retirement,” said LaVigne. “But less than four in 10 (38%) say they are confident that their financial plan can deal with the rising cost of living.”

The good news is that a majority of people (60%) recognize having a financial product that offers the opportunity for increasing income can help reduce that risk. Boomers are even more likely to agree, at 63%.

“Consumers who are worried about market volatility risks into 2020, and the rising cost of living well beyond next year, should work with a financial professional to help mitigate some of these risks, which may include financial products that offer guaranteed retirement income, and even the opportunity for increasing income¹,” said LaVigne.

About Allianz Life Insurance Company of North America

Allianz Life Insurance Company of North America, one of the FORTUNE 100 Best Companies to Work For® in 2019, has been keeping its promises since 1896 by helping Americans achieve their retirement income and protection goals with a variety of annuity and life insurance products. In 2018, Allianz Life provided $2.8 billion in benefit payments that helped policyholders achieve their financial goals. As a leading provider of fixed index annuities, Allianz Life is part of Allianz SE, a global leader in the financial services industry with over 142,000 employees in more than 70 countries. Allianz Life is a proud sponsor of Allianz Field in St. Paul, Minnesota, home of Major League Soccer’s Minnesota United.

Allianz Life conducted an online survey, the 2019 Q4 Allianz Life Quarterly Market Perceptions Study in November 2019 with a nationally representative sample of 1,005 respondents age 18+.

Allianz Life conducted an online survey, the 2019 Q3 Allianz Life Quarterly Market Perceptions Study in August 2019 with a nationally representative sample of 1,004 respondents age 18+.

Allianz Life conducted an online survey, the 2019 Q2 Allianz Life Quarterly Market Perceptions Study in May 2019 with a nationally representative sample of 1,006 respondents age 18+.

Allianz Life conducted an online survey, the 2019 Q1 Allianz Life Quarterly Market Perceptions Study in March 2019 with a nationally representative sample of 1,005 respondents age 18+.

Allianz Life conducted an online survey, the 2018 Market Perceptions Study, in April 2018 with a nationally representative sample of 803 respondents age 18+, who are currently not retired.

¹ Increasing income potential may be offered through additional-cost riders