Plan Sponsors and retirement professionals are charged with improving retirement savings outcomes for plan participants. As it turns out, employees want that, too. According to findings from our fifth national survey, employees continue to rely on their employers to help them achieve a secure future. And they’re not afraid of automatic plan features—such as auto enrollment and auto escalation—to help them accelerate their savings.
Not only did participants express the need to save more, they also wish they had started earlier. It’s the reason we coined this year’s national study, “Start Your Engines.” Here are a few highlights from the findings.
Past Retirement Savings Regret is Universal
As in previous studies, employees express a great deal of regret about their past savings habits. The majority suggest it would have been at least “somewhat helpful” to advise their younger selves to save more. However, about 75 percent were only “somewhat” to “very likely sure” they would have listened.
Retirement Plans are Highly Regarded
Employees appreciate their retirement benefits. Two-thirds said they “feel positive” about companies that offer automatic features and target-date funds. Participants also prefer employer plans over state-run plans, which several states introduced to overcome retirement savings shortfalls. Several more states have plans to introduce them too.
Reliance on Employers is Widespread
Employees look to their employers to jump start their savings. While they realize their own responsibility, employees want employers to offer plan features that can give them that extra nudge to start earlier and save more.
Insight for Plan Design
Retirement professionals and plans sponsors can gain valuable insight from participants. This insight can reinforce decisions about plan design and encourage them to seek ways to overcome the inertia that many participants need help with.
Retirement Professionals: Get Key Take Aways
Review more survey highlights and opportunities for plan sponsors and retirement advisors in the Oct. 26, 2017, Start Your Engines Webcast Replay.
The opinions expressed are those of Diane Gallagher and are no guarantee of the future performance of any American Century Investments portfolio.
This material has been prepared for educational purposes only. It is not intended to provide, and should not be relied upon for, investment, accounting, legal or tax advice.
The survey was conducted between July 27 and Aug. 3, 2017. Respondents included full-time workers between 25 and 65 years old, currently participating in their employer’s retirement plan, intending to retire at some point and not working for the government. A total of 1,500 respondents completed the survey. The data was weighted to reflect the makeup of key demographics (gender, income, and education) among all American private sector plan participants between the ages of 25 and 65 (according to estimates from the 2012 U.S. Consumer Population Survey). Percentages in the tables and charts may not total to 100 due to rounding and/or missing categories. Data collection and analysis were completed by Mathew Greenwald and Associates of Washington, D.C.