A Tale of Two Retirements: The Importance of 401(k) or Similar Employee-Funded Retirement Plans in the Workplace
A Tale of Two Retirements: The Importance of 401(k) or Similar Employee-Funded Retirement Plans in the Workplace contrasts the retirement outlook and level of preparedness enjoyed by those workers who are offered an employee-funded retirement plan compared with the challenges faced by workers who are not offered a plan.
The research finds many workers are at risk of not achieving a financially secure retirement. However, those with an employee-funded plan are in a better position to manage and reduce their risk when compared to workers without an employee-funded plan.
In addition to having the opportunity to save for retirement in the workplace and potential matching contributions from their employer, workers with an employee-funded plan are:
- More likely to be saving for retirement outside of work
- More confident in their ability to retire with a comfortable lifestyle and more likely to agree that they are building a large enough retirement nest egg
- More knowledgeable about retirement investing
- More likely to plan out a retirement strategy
- More aware of the Saver’s Credit and Catch-Up Contributions
- Less likely to expect to rely on Social Security as their primary source of income when they retire
The survey finds those less likely to be offered retirement benefits: part-time, small business, women, and lower income workers.
The research report is based on findings from the 11th Annual Transamerica Retirement Survey which included more than 3,500 workers. The survey was conducted between December 2009 and January 2010.