Participants in employer-sponsored, qualified retirement plans want automatic savings increases and more help making retirement decisions, according to a new study.
State Street Global Advisors, the asset management business of State Street Corporation, Boston, (NYSE:STT), published this finding in a summary of results from SSgA’s DC Investor Survey.
Conducted jointly with Boston Research Group, the survey polled more than over 1,000 employees who participate in 401(k), 403(b), 457 and profit sharing plans about their retirement planning decisions. The study confirmed previous SSgA findings about the need for employers to provide expert guidance and play an active role in helping make saving for retirement easier:
• 74 percent of employees surveyed want clear examples that will show them how their savings will pay off in the future.
• 71 percent want employers to increase their savings rate by one percent automatically each year; and
• 62 percent of employees 25 and younger said they want their employers to show them how to spend less so they can save more, compared to 53 percent of all employees surveyed. SSgA’s survey calls out an emerging group of younger investors categorized as “Generation DC.”
This group reports an ongoing desire to learn more about retirement readiness, despite the fact that they are more likely to be automatically enrolled into their DC retirement plan than their older peers.
Among the survey’s additional findings:
• 82 percent of employees 25 and under state they are on track to save enough to meet their retirement goals, while the average of all employees surveyed was only 63 percent;
• 48 percent of employees 25 and under say they have increased their savings outside of the workplace in the last 12 months, while the average of all employees surveyed was only 37 percent; and
• 50 percent of employees 25 and under say they favor a company-sponsored buddy program that encourages people to help other people save, while the average of all employees surveyed was 28 percent.