A recent survey of retirement plan participants shines a light on their positive perspectives – which can help inform plan changes you may be considering
Released in October of 2021, American Century’s 9th Annual Survey of Retirement Plan Participants found that more workers are optimistic about their futures in 2021 than they were in 2020. Not surprising, following more than a year of dealing with the pandemic, participants are now more positive about saving, risk and expectations. Since it’s the start of a new year, now may be an opportune time to discuss the findings with your plan advisor as you consider any plan design changes or adding features that may help improve retirement outcomes for your employees.
Optimism is trending up:
52 percent of survey respondents expect their retirement lifestyle to be about the same as it is now
3 in 10 expect their retirement lifestyle to be better than it is now.
More Millennials expect their retirement lifestyle to be a little or much better than it is now
However, concerns about running out of money in retirement are felt by workers of all generations and regrets about saving are still felt by many:
Not saving enough was the #1 regret (especially, as you might expect, among those with less savings)
Those with more assets are more likely to regret not taking more time to enjoy life
As in past years, the overwhelming majority of workers see the value of their retirement plan benefits. Many welcome automatic features to give them the “kick in the pants” or “slight nudge” they are looking for from employers:
More than 6 in 10 support auto enroll and annual auto increases
4 in 10 say retirement plans should be automatic for all
Other key findings:
90 percent of respondents say their retirement plan is a top benefit
2 in 3 prefer an employer match over a raise, regardless of percentage
2 in 3 support auto enroll at 6 percent
3 in 4 would leave money in the plan if it had specific investments for retirement withdrawals
7 in 10 need a little guidance on withdrawals for retirement
More than half are interested in environmental, social and governance (ESG) funds
2 in 3 would be more interested in ESG if performance was comparable
Market risk is a top concern, although only slightly more than longevity
The survey offers these key insights for retirement advisors and plan sponsors:
Optimism is on the rise
Investing for retirement is a priority for participants regardless of age.
Employers are having a positive impact on accumulating assets.
Participants are now looking for help in withdrawing assets.
To download a presentation of American Century’s survey findings, go to: https://tinyurl.com/pte2v3ka
For questions, please contact your Trusted KerberRose Advisor.