DC Plan Contributions 'Major Factor' in Retirement Success: EBRI

It's been well-reported that many workers are delaying or planning to delay retirement, but a report from the Employee Benefit Research Institute released Tuesday found that it may be for naught. A major factor in ensuring a secure retirement is participation in a defined-contribution plan after age 65.

The report found that workers in the lowest preretirement income quartile would need to delay retirement to age 84 for a 50-50 chance at a secure retirement. Over three-quarters of the wealthiest workers will likely have sufficient income in retirement. Delaying retirement just four years increases the percentage of workers with adequate retirement savings to over 81%.

“Our research finds that many people may have to delay retirement far beyond age 65 to increase the probability that they have enough money to cover their retirement expenses at a comfortable level,” Jack VanDerhei, EBRI’s research director and co-author of the report, said in a statement. “What really makes a positive difference, we found, is if people who continue to work after 65 also continue to contribute to a defined contribution retirement plan.”