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Benefits December 27, 2004
Survey: Nearly a Third of Workers Haven't Started Retirement Savings
December 27, 2004 (PLANSPONSOR.com) - While nearly
half of employees in a survey said they were concerned about
outliving their retirement savings (49%), almost a third
haven't yet started funding their retirement kitty or haven't
yet set a retirement savings goal.
Reported by Fred Schneyer
Those were among the findings of the latest MetLife Study of Employee Benefits Trends, which surveyed workers and employers during the third quarter of 2004, according to a MetLife news release.
To make things worse, only four in 10 workers understand their employer’s benefits program and 27% try to fill in the information gap by talking to friends and relatives, the MetLife study found. Meanwhile, more than four in 10 (43%) of employees look to their employer to provide a financial planner they can enlist to help them invest assets in their K plans. Four in 10 said they worried about not having a financial plan while a third (31%) said they were concerned about finding a trusted source for financial advice. Some 48% fretted about having to work at least part time to live comfortably in retirement.
K plans or 403(b) programs are also losing in popularity, the survey found. Although the retirement savings plans came in third of a list of benefits when workers were asked to choose the most important, the percentage putting the retirement programs at the top fell from 67% in 2003 to 57% in the latest survey. Defined benefit pensions saw a similar popularity decline over the year going from 42% in 2003 to 32% in 2004.Topping the list were medical plans (81%), followed by vacation time (64%). Trailing the list of valued benefits was homeowners/renters insurance (3%).
Many workers’ apparent disconnect with prudent retirement planning isn’t for their employer’s lack of trying in giving them access to a K plan or other qualified retirement savings plan – at least when it comes to those at larger companies. According to the survey, a whopping 91% of employers with 2,500 or more provide qualified plans. That drops to 85% at companies with 1,000 to 2,499 employees and 83% at firms with 50 to 999 workers. The smallest coverage is at the smallest firms (two to 49 workers) where only 53% offer a qualified retirement program, according to the survey.
The study findings are here .