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Two-Thirds of Americans Fail 401k Wellness Survey


CAMAS, WA, December 8, 2016 -- A new 401k survey, released today by Fisher Investments 401k Solutions, suggests a startling knowledge gap among Americans when it comes to the 401k plans offered by their employer. While most people may think they understand their 401k, 71 percent of respondents failed Fisher's 401k IQ in the Workplace Quiz, missing at least three of the nine basic questions.

Most Americans (88%) understand topics like 401k matching, but they struggled on the quiz when asked about additional topics that are critical to making 401k decisions. For example, only 24 percent of respondents could define a mutual fund and only 43 percent knew the percentage of their salary they should save for a comfortable retirement.

"These results point to a larger issue that I see regularly with clients," said Nathan Fisher, Managing Director and head of Fisher Investments 401k Solutions. "People tend to understand the big picture value of 401k plans, but when you start to get more specific they quickly struggle, which is a huge problem. If you don't have a complete understanding of your 401k, you might not select the best investments for your unique retirement needs. If you are not confident in your ability to pick investments, you might not save enough."

This sentiment was reflected in the data: while 4 out of 5 Americans say they prefer to work for companies that offer a 401k plan, a majority (66%) are not confident in choosing 401k investment options. Moreover, one in four Americans claim they were not involved or can't recall how they picked their 401k assets, and over 40 percent are not confident that they will reach their retirement goals.

"Support is the key to addressing these gaps. I find it startling that half of the respondents in our survey said that they do not currently receive any one-on-one help from their 401k provider, but an overwhelming majority wished they did." Fisher continued, "Unfortunately, it can be easy for employers to get hung up on evaluating providers based only on fees and/or costs. While this is an important factor, criteria like support are equally important and can have a direct and lasting impact on your employees' financial future."

Employees at small businesses (those with between 5-200 employees) tend to be even less confident about their 401k. This group had a larger fail rate in the Fisher's 401k IQ in the Workplace Quiz, with nearly four out of five respondents failing. This group was also more likely to say that their provider does not make them feel in control of their financial future and that they wish their 401k plan was easier to understand.

"Small businesses owners want to provide the best possible benefits to their employees, but they often lack the time or resources to assess benefits like 401k plans," concluded Nathan Fisher. "However, it doesn't have to be daunting. This survey can provide a roadmap for small business owners to evaluate and select 401k plans that will help address the gaps."

Additional findings from the survey include:

  • Americans don't trust their 401k providers: Trust is an important aspect of retirement planning, both trusting your employer and your advisers. Unfortunately, the survey found one out of four Americans does not trust their 401k provider. Interestingly, a third of respondents said that they look to friends or family members for information and guidance on 401ks. This number was much higher among millennials, with 41 percent saying they look to friends and family members for information.
  • Women are less confident when it comes to 401ks: Though academic and industry research shows women tend to make more thoughtful investment decisions, when it comes to monitoring the progress of 401k accounts, only 1 in 5 women make it a priority. Moreover, women were less likely to say they know how to pick investments in their 401ks.

About Fisher's 401k Wellness in the Workplace Survey

Fisher's 401k Wellness in the Workplace Survey was conducted by KRC Research, on behalf of Fisher Investments, to explore 401k plan knowledge, information access and service satisfaction in employees working for small, medium and large businesses. The survey also included a nine question 401k IQ in the Workplace Quiz, to test basic 401k knowledge.

KRC Research surveyed 1,013 American employees working for companies that offer 401k plans. Research was conducted via 10 minute online survey from October 7-11, 2016 amongst respondents from an even mix of demographics and company sizes.

About Fisher Investments

Fisher Investments 401k Solutions is dedicated to bringing superior retirement plan services to small and mid-sized businesses and their employees. Fisher's unique service offering is built on 35+ years of successful wealth management experience and includes our flexible investing platform with actively-managed funds. Business owners will experience the benefit of ongoing support from a dedicated Retirement Counselor whose focus is making the management of a 401k retirement plan easier, while helping employees plan for a comfortable retirement. For more information, visit http://www.fisher401k.com/.


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