Survey Shows Employees Applaud Being Forced to Save

When it comes to saving for retirement, most Americans don’t mind a little nudge from their employer. In fact, they welcome it. In its fourth annual national survey of plan participants, American Century found that most participants believe they would have more if their employer had done everything possible to help them save. ‘They are looking to their employers to help them along that path so its saving at a higher percentage, starting at 6% and creeping them up every year as well,’ said Diane Gallagher, vice president of practice management at American Century Investments. ‘They are really looking for help on their saving habits.’ 70% of those surveyed believe automatic enrollment at 6% is something employers should do and over 50% feel automatic enrollment should be implemented retroactively. Two thirds of those surveyed feel more positive about a company that offers automatic enrollment, automatic increase and target-date investments over a company that does not. Over seven in ten participants support plan investment re-enrollment into target-date investments. And over 80% of participants in the survey want at least a ‘slight nudge’ from their employers in helping to save and invest for retirement. American Century also revealed that participants are interested in an automatic increase option where the amount taken out of employees’ paychecks increases by 1% every year until it hits 10% or more. More than eight in ten participants view their retirement savings plan at work as one of the most important benefits offered by their employer. Most participants regret how and when they saved for retirement. Nine in 10 participants are troubled by at least a little regret with respect to saving for their future. Eight in ten participants believe they could have saved more in the past, a significant increase from 2015 among 25 to 54 year-olds particularly. An overwhelming majority in the survey recognize that it would be far worse to have too little money in retirement than to miss out on something today. Overall, a large majority of participants expect their standard of living to be the same or a little lower than what it is today. Finally, eight in 10 participants would prefer a match on their retirement contribution of 100% up to 3% over a 3% salary increase and three-quarters say the same when the figure is raised to 6%.

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