Celebrate National Retirement Security Week with These Small Steps
posted by Fisher 401(k) October 21, 2019
It’s National Retirement Security Week, and there’s no better time to take some small steps that can have a big impact on your financial future. Below are two quick tips for employers and two for employees.
EMPLOYER STEP 1: TAKE ADVANTAGE OF YOUR RETIREMENT PLAN ADVISER’S SUPPORT TO HELP YOUR EMPLOYEES BETTER PREPARE FOR RETIREMENT
The first step is the easiest: Lean on your retirement plan adviser! Your adviser’s support can make it easier for your employees to make full use of the company plan.
Ask your adviser for educational materials about investing basics, setting savings goals, and more. And if they haven’t been out to visit with your employees for a while, ask them to come back. Often, one-on-one meetings with retirement professionals can give employees the focused help they need to uncover their unique retirement goals—and develop a plan to meet those goals.
But that support shouldn’t begin and end with in-person meetings. Ask for help from your adviser to make it as easy as possible for employees to contact retirement professionals and get help with anything from updating their saving rates to understanding their investment options.
The key here is to ask for more employee support. Tell your adviser you’re serious about improving participation and savings rates, and ask what they can do to engage your employees in a meaningful way.
EMPLOYER STEP 2: PROMOTE THE COMPANY RETIREMENT PLAN
For the majority of employees, a 401(k) or other retirement plan that allows them to save is the second most sought-after employee benefit.1 But that doesn’t mean enrolling in the company plan is a top priority for every employee. That’s where the power of regular communication can make all the difference.
Consider sending out an email this week in honor of National Retirement Security Week that encourages your employees to enroll or speak with your service provider to assess their current strategy. If you have an employee you know values your retirement plan, tap them to share their experience in the email and serve as a sort of “retirement ambassador” who can answer quick questions and help engage employees.
For a deeper dive into employee engagement and how you can both measure and improve the level of engagement your employees have with your retirement plan, check out 401(k) Engagement - Helping Employees Make the Most of Your 401(k) in our Resource Library.
EMPLOYEE STEP 1: START CONTRIBUTING TO YOUR EMPLOYER-SPONSORED RETIREMENT PLAN AS SOON AS POSSIBLE
If you aren’t already contributing to a retirement account, there’s no time like the present. The sooner you begin saving, the more time your money will have to grow through investments. In recent history, stock gains have averaged approximately 8.2% from 1995 to 2015.2 The current bull market has been running since March of 2009, leading to record stock prices.2 By starting to save now, you can tap into the power of compounding investment growth.
Consider this: If you save just $1,000 this year, that money can earn interest as it’s invested in the stock market. Over time, that interest also earns interest. At an average annual gain of 8.2% per year, after 30 years that original thousand-dollar investment grows to over $10,000! Of course, there’s no guaranteeing returns in the stock market. But the potential your savings have to grow, no matter how small you start, can make all the difference in securing the retirement of your dreams.
Speak with your employer about enrolling in your company retirement plan, and start growing your retirement savings today.
EMPLOYEE STEP 2: REVIEW YOUR SAVINGS AND INVESTING STRATEGY REGULARLY
It’s a good idea for employees who’ve already set up their retirement plan contribution rate and investment strategy to review these each year with your company’s retirement plan adviser. Lives change, goals change, and perspectives change—it’s important to make sure your retirement future is changing with you.
National Retirement Security Week is a great opportunity to review your current strategy and see what opportunities you may have to increase your savings rates. Use our retirement calculator to enter some basic information about your age, timeline to retirement, current savings amount and rate to see how much money you are likely to have available to you in retirement. The best part? You can play with the numbers to see the impact of just a small increase in your savings and find the right number that fits your current finances and your future goals.
Once you have your results, or if you have any questions along the way, it can be helpful to speak one-on-one with a retirement professional. Ask your employer about who you can speak with at your company's 401(k) adviser to review your retirement calculator results, test out different savings scenarios, and make a good plan for your future.
1Transamerica Annual Retirement Survey 2016.
2Source: S&P 500, 12/31/1995 – 12/31/2015