New nonpartisan data has uncovered a major uptick in retirement confidence, as millions of Americans with access to workplace retirement plans finally took advantage of the wide array of resources long available to them.
Those tools included the use of online calculators and the help of plan advisors. “I was always too busy to take advantage of these resources,” noted survey participant Jack V. Copeland. “Frankly, with all the negative coverage about retirement shortfalls and such, I didn’t see much point.”
Not that the new research, published by the Oxford Newfound Institute of Nihilism (ONION), didn’t uncover retirement savings shortfalls among survey participants. However, with workers now taking the time to assess their personal situation, savings rate and projected retirement income needs, developing plans to address the situation rather than simply worrying about their dim prospects for retirement savings success became the order of the day. Previous research had shown that fewer than half of workers had made even a single attempt to assess their retirement needs, and many of those had simply guessed.
Ironically, despite this newfound and dramatic increase in confidence, the new retirement savings goals were not only more likely to produce a successful outcome, they were generally higher than the goals previously set by workers who had gone through the process.
Some of the most dramatic impacts were recorded by participants in plans where employers had not only provided for automatic enrollment immediately upon hire, but who applied automatic enrollment retroactively to existing hires as well. “All these years, I just assumed my employer thought it was too late for me to start saving,” said one long-time worker who had just been automatically enrolled under such a program.
A separate, plan sponsor-focused report found that the renewed focus and confidence translated into tangible workforce management benefits as well. “We found that a growing number of older workers were simply hanging on to their old jobs, afraid to retire because they had no idea how much they would need to have in retirement,” observed one. “Now, for the first time in a long time, we’re seeing workers actively plan for their retirement date with confidence. We should have done this years ago!”
- Nevin E. Adams, JD
Note: Sure it's April Fool’s, but while the post above has a certain tongue-in-cheek character, the implications are not as fictional as you might think. In fact, they are well within the realm of a very potential reality for millions more — with a little help from plan advisors, their plan sponsor clients and the cooperation of plan participants.