Research Reveals Employees Worry More About Money for Retirement Than Monthly Expenses

Saving for retirement ranks as top financial concern, The Standard finds

Dateline:

PORTLAND, Ore.
"For most, this is just a 1 or 2 percent increase. But even a small additional increase each year can help make a specific retirement goal a reality."
October 29, 2018

PORTLAND, Ore.--(BUSINESS WIRE)--Regardless of their income level, 70 percent of employees indicated that saving money for retirement is their top financial concern, according to research from The Standard.

Other notable concerns include having enough money to pay for:

  • monthly expenses (57 percent)
  • medical expenses (52 percent)
  • support if a disability is incurred (52 percent)
  • mortgage/rent (49 percent)

We found that saving for retirement outweighs other important priorities such as ensuring employees have enough money for a roof over their heads or medical expenses,” said Chris Dugan, director of retirement plan communications for The Standard. “Given its importance to employees, it’s crucial for advisors and employers to do what they can to help support their retirement readiness efforts.”

While saving money for retirement is a top financial concern, only 33 percent of employees are confident about their level of retirement readiness. As the new year quickly approaches, employers can make small but effective changes to their retirement plans to boost employees’ preparedness. Dugan has identified two key retirement considerations for advisors and employers planning their retirement plan approach for 2019.

Employers can boost preparedness with automatic features

To help address retirement fears, plan features like automatic enrollment and automatic deferral rate increases can help improve retirement outcomes. The support for these features is high among employees, with 68 percent supporting automatic options according to research from The Standard. Generational groups also support these options, including:

  • 70 percent of millennials
  • 66 percent of Gen Xers
  • 64 percent of baby boomers

“Employers should also consider a managed account service as the Qualified Default Investment Alternative, which offers annual automatic deferral rate increases that are customized to the needs of an individual,” Dugan said. “For most, this is just a 1 or 2 percent increase. But even a small additional increase each year can help make a specific retirement goal a reality.”

Employees want retirement planning advice

It’s easy to get overwhelmed when planning for retirement, which is why employees want guidance. The same research finds that about half of employees say they aren’t comfortable selecting their own retirement plan options. Similarly, 55 percent of employees are interested in having a professional help them choose investments and manage their savings.

“Employees can benefit from using a managed service through their retirement plan, which is often very affordable, to help with investment decisions,” Dugan said. “Some managed services have a team of dedicated and licensed advisor representatives available that can serve as a resource for those who prefer to talk through their options. These services may lead to higher participation, engagement and overall levels of retirement readiness.”

For more information on The Standard’s study, view this infographic.

About Chris Dugan

Chris Dugan is the director of retirement plan communications at The Standard. Chris has over 20 years of experience in the defined contribution industry and has served in various communication leadership roles at The Standard over the past 14 years. Chris seeks to partner with advisors to deliver communication and education that will help reduce fiduciary risk and administrative burdens for plan sponsors, while at the same time improving the retirement outcomes of their employees. Chris graduated from the University of Oregon with a bachelor’s degree in finance and earned his master’s degree in business from the University of Portland.

About The Standard

The Standard is the marketing name for StanCorp Financial Group, Inc., and its subsidiaries. StanCorp Equities, Inc., member FINRA, wholesales a group annuity contract issued by Standard Insurance Company and a mutual fund trust platform for retirement plans. Third-party administrative services are provided by Standard Retirement Services, Inc. Investment advisory services are provided by StanCorp Investment Advisers, Inc., a registered investment advisor. StanCorp Equities, Inc., Standard Insurance Company, Standard Retirement Services, Inc., and StanCorp Investment Advisers, Inc., are subsidiaries of StanCorp Financial Group, Inc., and all are Oregon corporations.

Contact:

General Media
The Standard
Bob Speltz, 971-321-3162
bob.speltz@standard.com
or
Trade Media
Bader Rutter
Katharine Foley, 262-938-5460
kfoley@bader-rutter.com

Monday, October 29, 2018 6:00 am PDT
Business Wire NewsHQsm