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November 28, 2022 at 01:50 PM
What You Need to Know
- About two-thirds of Americans haven't changed their investment approach toward retirement, according to an Empower survey.
- Research showed that participants engaged in their retirement planning have 56% higher savings rates than their unengaged peers.
- However, the number of participants who took out loans increased by 13% over the past 12 months.
Some 63% of Americans are confident that they are financially on track for retirement, notwithstanding rising prices and inflation, according to research released recently by Empower, which administers assets for more than 17 million retirement plan participants.
“When the economy is experiencing a downturn, American workers need guidance and support to help deter them from making financial decisions that may negatively affect them down the road,” Edmund Murphy, Empower’s president and chief executive, said in a statement.
“Despite the challenges our country is facing, it’s encouraging to see that most savers haven’t changed their investment approach and are still focused on saving and planning for their future.”
Researchers analyzed 4.3 million active participants from primarily corporate DC plans with Empower as the recordkeeper, and conducted a survey in August among 2,505 working Americans between 18 and 70 years old.
Research Findings
The research showed that participants who are engaged in their retirement planning have 56% higher savings rates than unengaged ones. They are also likelier to take full advantage of their plan’s employer match.
Forty-eight percent of unengaged participants are not making full use of the employer match, compared with 22% of those who are engaged.
Participants who link multiple financial accounts in one place to create a consolidated view have savings rates approaching 11%, almost double the savings rate of unengaged participants. Forty-four percent of survey respondents said they felt more confident when they were able to see their financial account balances, debt and assets in one place.
