Retirement Security Has Improved Since Pre-Recession Levels
LOS ANGELES, CA, September 25, 2018 -- American workers are more secure in their retirement preparations now than before the Great Recession, but much more can and should be done, according to a comparative analysis of survey findings released today, A Retirement Security Retrospective: 2007 Versus 2017, by nonprofit Transamerica Center for Retirement Studies (TCRS).
"American workers encountered a myriad of challenges over the past decade, including high rates of unemployment, dramatic shifts in home values and volatility in the financial markets. While many workers are still recovering from the Great Recession, the good news is that many have seen improvements in their future retirement security," said Catherine Collinson, CEO and president of Transamerica Institute and TCRS.
The new report illustrates the resilience of the U.S. retirement system, especially regarding 401k or similar plans. The findings underscore that most Americans can still do more to adequately prepare themselves for retirement -- even if they have recovered from the recession -- and to do that successfully they need support from employers and policymakers.
Workers' Savings Have Increased yet Many Are Not Adequately Planning
Workers have made progress in achieving higher levels of retirement security according to several survey findings, yet they also have some specific areas requiring attention. Key findings include:
"While the growth in workers' retirement accounts since pre-Great Recession levels is impressive, many workers may not be saving enough to meet their retirement income needs and most could benefit from planning-related activities such as estimating savings goals and setting forth a financial plan," said Collinson.
Employers' Offering of 401k or Similar Plans Held Steady - And Some Have Enhanced Their Plans
It is well documented that employers' offering of retirement benefits is one of the most effective means of encouraging workers to save for retirement. While many employers faced difficult cost-cutting decisions during the Great Recession, 401k plan sponsorship rates remained strong, with some employers having enhanced their plans. Key findings include:
How Workers, Employers, and Policymakers Can Improve Retirement Security
"Workers, employers, and policymakers collectively play a vital role in improving retirement security. By recognizing the opportunities, each stakeholder can take appropriate action and implement solutions," said Collinson.
"People now have the potential of living longer than any other time in history, which means that workers want and need to extend their working lives to fund what promises to be very long retirements. Our retirement system, including Social Security, employer benefits, and employment practices, should be modernized to embrace this new reality so that all workers have the opportunity to retire and grow old with a financial peace of mind," said Collinson.
Please visit TCRS at www.transamericacenter.org to view the study along with other research reports and materials from the 18th Annual Retirement Survey. Follow TCRS on Twitter @TCRStudies.
About Transamerica Center for Retirement Studies
Transamerica Center for Retirement Studies® (TCRS) is a division of Transamerica Institute®, a nonprofit, private foundation. Transamerica Institute is funded by contributions from Transamerica Life Insurance Company and its affiliates and may receive funds from unaffiliated third parties. TCRS and its representatives cannot give ERISA, tax, investment or legal advice. This material is provided for informational purposes only and should not be construed as ERISA, tax, investment or legal advice. Interested parties must consult and rely solely upon their own independent advisors regarding their particular situation and the concepts presented here. For more information please visit www.transamericacenter.org and follow TCRS on Twitter at @TCRStudies.
About the Annual Transamerica Retirement Survey
The Annual Transamerica Retirement Survey of workers and employers is conducted in the U.S. by The Harris Poll on behalf of TCRS. Samples are nationally representative and weighted as needed. Full methodologies can be found at www.transamericacenter.org.
A 16-minute online survey conducted between October 11 and November 21, 2007 among 3,012 workers, including 2,048 who were offered a 401k or similar plan. Potential respondents were targeted based on employment status, company type, and company size. Respondents met the following criteria: U.S. residents, age 18 or older, full- or part-time workers in for-profit or nonprofit companies with 10 or more employees. This report focuses on workers in for-profit companies.
A 25-minute online survey conducted between August 9 and October 28, 2017 among 6,372 workers, including 5,619 who worked for employers with 10 or more employees, of whom, 3,820 were offered a 401k or similar plan. Potential respondents were targeted based on employment status and company size. Respondents met the following criteria: U.S. residents, age 18 or older, full- or part-time workers in for-profit companies with five or more employees. This report focuses on workers of companies with 10 or more employees.
An 18-minute telephone study conducted between October 11 and November 21, 2007 among 652 employers, including 567 that offered a 401k or similar plan. Potential respondents were targeted based on job title and met the following criteria: business executives at for-profit companies that employ 10 or more employees and who make decisions about employee benefits at their company.
A 21-minute online survey was conducted between November 15 and December 15, 2017 among 1,825 employers, including 1,512 with 10 or more employees, of which, 1,254 offered a 401k or similar plan. Potential respondents were targeted based on job title and met the following criteria: business executives at for-profit companies that employ five or more employees across all locations and who make decisions about employee benefits at their company. This report focuses on employers with 10 or more employees.
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