SURVEY SAYS: Adequately Saving for Retirement

Last week, I asked NewsDash readers how prepared they feel for retirement, but I was more curious about whether they are following some of the suggestions they or their advisers and providers give their employees?

Nearly 64% of responding readers work in a plan sponsor role, while 17% are advisers/consultants, and 19.1% are TPAs/recordkeepers/investment managers.

Among responding readers, nearly three-quarters (73.5%) feel they are adequately saving for their desired standard of living in retirement. However, 16.3% do not, and 10.2% said they don’t know.

Given a list of common suggestions offered to employees for optimizing retirement savings outcomes, responding readers do a good job of making sure retirement savings investments are properly diversified (70.2%), and deferring enough so that total savings (employer and employee) is at least 15% (66%).

Just more than half (57.4%), indicated they defer at least enough pay into the retirement plan to get a match, and less than half reported they seek professional financial advice and research and establish how much they will need to save to have a secure retirement (44.7% each).

Less than one-third (31.9%) increase their savings rate each year, and only 12.8% have made a written plan for saving for and spending in retirement.

Verbatim responses reflected some regrets and obstacles that can derail retirement plans are just as real for plan sponsors and providers as for participants. Many offered more suggestions for saving adequately, and several asked how it is possible to know if savings are adequate with questions about market moves, Social Security sustainability and health care costs in retirement. Editor’s Choice goes to the reader who said: “How can you really ‘know?’ Social Security is questionable at best if you’re middle-aged or younger, markets are incredibly volatile, health care is a disgrace… okay, now back to the work of encouraging people to save!”

Verbatim 

It takes discipline.

It never seems to be enough

It appears adequate on paper, as long as I can stay healthy and working until the designated "retirement date." If it all goes askew, at least I have 4 kids!

I feel good that I have saved more than majority of workers my age, but how will we ever know that it is enough?

How can you really "know"? Social Security is questionable at best if you're middle-aged or younger, markets are incredibly volatile, health care is a disgrace... okay, now back to the work of encouraging people to save!

I had been on track until my husband was injured on the job at 40, then when he recovered he was struck with a debilitating illness that has rendered him unable to work again. Between medical and tuition bills, our debt is enormous. People scoff when I say I am worth more dead but I am not joking. Although I make decent money retirement is out of the question for me. The best laid plans....

My pet peeve is the 80% rule (i.e., 80% of current gross income) used by some advisers to estimate the annual income needed in retirement. It fails to take into account myriad essential factors in evaluating income needs in retirement, e.g., the retiree's health, family size, and outstanding debt. It is much better to write out a monthly budget and then consider how those expenses may change in retirement.

Basically I try to save as much as I can within the limits, but it is pretty easy to reach the limits given my employer provides a 12% profit sharing contribution and matches another 4% 1-to-1.

My biggest concern for retirement is the great unknown - Health Care Costs. I may think I have enough saved, but I don't know how much health care will cost me.

Hmmm, loaded question. Kinda like asking a politician if they've ever lied to the American public. I should be surprised if anyone here says no...right!?

I and spouse have enough in guaranteed income from DB over 35 years and SS that we do not need to save for retirement. After tax RMD will be reinvested. One of the lucky ones I guess. Or was that luck??

I know they are in no way safe from the vagaries of the economy but I am extremely thankful for my husband's DB plan because my DC plan won't cut it.

Verbatim (cont.) 

Save to the max and never retire

I wish I started earlier.

Our employer does not offer a match so I did not check off the first suggestion in Question 3. It is all about saving early in your career, knowing your current expenses so you can realistically lay out your expenses for retirement, being diversified, and looking long term (ignore the ups and downs of the stock market).

Start young, play it safe, and don't look at your balance every day.

Start early in life, saving at least 15% (including match).

I have been contributing the maximum allowed for many years.

Although my financial adviser indicates I'm doing well I always have this fear I won't save enough. My biggest concern however comes when I stand looking out the kitchen window and look at other homes on the block. There's no possible way people in my neighborhood are even thinking of retirement so I can't image they are saving anything. Then again I could be surprised. I really wish the country as a whole would do more for retirement education or mandate that people start saving for retirement. I'm tired of paying taxes because others feel entitled to government benefits but don't want to work.

It is hard to know how much to save with health care costs a huge unknown. Should have had children to support me in my old age!!

I am supposed to have 2 - 2 1/2 million dollars saved when I retire. I guess I will have to lower my standard of living!

Live on less than you make...invest for retirement properly and you're 3/4 of the way there. You have the advantage that what you need in retirement is less than the "experts" will say (because you live on less than you make). The last 1/4 of the plan is stick to it.

We just met with our Financial Planner this week and I'm so excited knowing I'll be able to retire earlier than I expected! It makes a huge difference when you start saving early in your career. I wish I could convince more people of this necessity!

Save, Save, Save. If you don't need it, do not buy it. It just clutters up your house and takes up time caring for it and spends money you may need later.