Things seem to be looking up for American retirees these days. Two groups are most likely to feel confident about their retirement readiness: retirees, who report feeling more secure in their ability to live comfortably in their retirement years, and workers with a retirement plan, whether it’s a defined contribution (DC) or defined benefit (DB) plan, or an individual retirement account (IRA).
In fact, 79% of retirees say they feel very or somewhat confident that they have enough savings to live well in their retirement years. One-third (32%) of those feel very confident.
Additionally, workers who have a retirement plan, whether through their employer or otherwise, are more likely to feel confident about having enough money to sustain them throughout their post-working years. Typically, they have saved more, taken more action to prepare for retirement, and feel less stressed overall about their retirement readiness than those without access to a retirement plan. It goes to show that having a vehicle for savings is a much stronger catalyst for retirement preparation — a boon for plan sponsors who are helping employees to make the most of their retirement benefits.
These are just some of the key findings from the 2017 Retirement Confidence Survey from the Employee Benefit Research Institute (EBRI). Now in its 27th wave, the RCS is the longest-running survey of its kind in America, according to EBRI.
Financial Wellness Can Help Boost Peace of Mind
Underscoring the importance of holistic financial wellness programs in the workplace — a trend that’s catching on with many employers — roughly half of workers EBRI surveyed say that programs focused on retirement planning (53%), financial planning (49%), or healthcare planning (47%) would help increase their productivity at work. About 30% of workers report worrying about their personal finances while on the job, and more than half say they believe they would be more productive at work if they didn’t have these concerns.
As such, implementing a comprehensive financial wellness program that simplifies key concepts like budgeting, long- and short-term savings goals, and investing, and that keeps employees on track toward those goals can go a long way toward creating greater peace of mind and a happier, more productive workforce.
Matching Motivates Saving
Employer matching contributions and automatic payroll deductions are two great ways to motivate employees to save for retirement. EBRI found that 73% of workers not currently saving say they would be more likely to do so if their employer offered a match. Further, two-thirds of non-savers say they would be incentivized to set aside money for retirement via automatic payroll deductions of 3% to 6% of salary, if they had the option to stop or change them.
Read the entire EBRI Survey here.