Saving for Retirement

Preparing for retirement is a primary financial concern for most Americans. And while according to the 2007 EBRI Retirement Confidence Survey, 66% feel they have are saving enough, only 43% have actually done the math. That begs the question, how can you be prepared if you don’t know what you’re preparing for?

The Wall Street Journal estimates 20% to 30% of eligible Americans don't participate in their company's 401(k) plan. Those that do often make mistakes that could jeopardize their retirement security, such as investing too conservatively or contributing too little.

The growing concern over inadequate retirement planning has prompted employers to step up to help investors save by automatically enrolling employees in the company’s plan. Employees are allowed to opt out of such employer-directed moves. But few do, and that means employers' actions can dramatically change how workers' savings are invested.

While this may help some of the least prepared investors, these actions don’t do much for investors who are blindly saving. New education and coaching tools are necessary to help investors get on track and stay there.

EBRI

Employers Grab the Reins of Workers 401(k)s (for WSJ subscribers)