MassMutual wanted to know if the amount people save toward retirement equate to an appropriate level of confidence? To find out, the company conducted a study that included responses from 17,000 people at 2,300 MassMutual-administered employer-sponsored retirement savings plans. The study broke respondents up into three categories:
- Low savers – Those who deferred less than 4 percent of salary.
- Medium savers – Those who deferred from 4.1 percent to 7.99 percent.
- High savers – Those who deferred 8 percent or more.
But results revealed that what people do and what they say don’t always align.
- Misplaced confidence? High savers were less confident in the investment decisions they made – 44 percent were confident – than were the low and medium savers at 54 percent.
- Is more enough? While high savers may have accumulated more savings over the years, 44 percent feel they won’t have enough saved at retirement.
- Who can help? Almost 80 percent of high savers say they want investing help, even though 57 percent also said they enjoy managing their finances, while only 47 percent of low and middle savers express a wish for help.
“The lesson is that some of the traditional assumptions about investment confidence, like deferral rates and active investment decisions, may indicate the exact opposite,” says Ian Sheridan, corporate vice president and CMO for MassMutual’s retirement services division.