Latest Hewitt Assoc survey shows only 6% accept responsibility for retirem

[papau]

just because they get a 401k. So Employers feel that 94% of their employees still feel no ownership of the need for retirement income. The prior survey had 12% so it has dropped in half. This has not stopped Corporate America from killing (limit access to or freeze) their DB plans so as to gain a higher bottom line via a switch to 401k.

Indeed nothing effective is being done to change this employee attitude. The move to a "Auto Plan" features continues, but seems to have little effect. And improving participant education has actually been shown to be ineffective.

Only 6% of the respondents to Hewitt's survey said they are confident their employees will take accountability for their own retirement future this year, down from 12% in 2005, according to the press release on the study.  As a result companies plan to add automated features to their retirement plans such as auto enrollment, automatic contribution increases, and automatic portfolio rebalancing.
 
Hewitt's survey revealed that 23% of companies are very likely to add automatic enrollment features in their 401(k) plans by the end of the year, 13% are very likely to add contribution escalation features, and 20% plan to add automatic rebalancing of 401(k) accounts. Fifteen percent of respondents say they are very likely to close participation to new employees, six percent say they are very likely to freeze accruals, and five percent are very likely to change the design of their pension plan- 16%  of companies offering company stock will either limit employees' investment in company stock or eliminate it as an investment option in 2006 - and 79%of companies say they plan to make no changes to their company match. Eight percent say they plan to add/increase the company match, and only 1% say they plan to reduce or eliminate the company match.

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My Shock and awe moment was reading that 30% of the non-highly paid would not invest in a 401k or like program regardless of the size of the match!

Looks like America will indeed have a retirement problem in 50 years - and it won't be because of Social Security.

[catnhatnh]

1. Really???-The problem I see here...

...is a statement of employer's "beliefs" that reduced by 50% last year that employees will "take accountability" for their retirement....there IS a reason for social security, and this is it...

[wryter2000]

2. Maybe there's something wrong with me

Almost all my life, I've had very little money above what I need to exist (and I'm not talking extravagantly here). For several years, my husband and I didn't have enough to make basic expenses. Now that I've lost his social security and pension, I'm barely squeaking by. In fact, I may have to sell the house if things don't improve.

Telling someone like me "you must save for your retirement" makes about as much sense as telling me "you must sprout wings and fly to work because we're tearing down the freeway."

I always want to scream at finance gurus who tell me, "you must make your own plans for retirement." What plans can I make???!!! How many other people are in the same boat?

[papau]

3. Exactly - but in Bush/Reagan greed is good world - your screwed

:-(

[wryter2000]

7. It was Reagan who almost did us in

Raygun's fabulous economy cost us my husband's job. That began a serious downward spiral we only recovered from when he started getting Social Security. He died last year, and I'm too young to get survivor benefits. I'd blame his death on *asshat if I could find a way. :evilgrin:

[catnhatnh]

4. Well-they won't help you...

but they will tell you that tax-free munincipals and gold are a good way to go....why do you hate America???

[On the Road]

5. The Attitude You Refer to is Pure "Let Them Eat Cake"

Unless people have a living wage, telling them they have to save is ludicrous. You are understandably outraged.

On the other hand, there is a very cavalier attitude about savings in this country, especially among the working classes who need it the most. If you have a regular paycheck and are offered a 4% match by saving 6% of your income, it's crazy to turn it down. It's too just too good a deal to pass up.

There are always ways of adjusting. The Chinese save unbelievable amounts of money even if they have to live on rice and vegetables. It is possible if it's taken seriously enough.

I'm afraid of the effects of my generation's spending their seed corn and having nothing in retirement. I'm concerned even though I'm in better shape than most people my age.

[wryter2000]

6. Well, I did just send Paul Hackett $25

:evilgrin:

Seriously, I could put a few bucks aside, but it wouldn't be nearly enough to make a difference toward retirement. I take home about $2,500/month and have a $2,400 house payment. I do have a few other sources of income (some writing income and bonuses and vacation cash-out). But, where in there am I supposed to save enough to make any difference to my retirement?

And I'm one of the lucky ones because I have a good job and health care. Lots of people are in way worse shape than I am.

[fasttense]

8. How many CEO's are saving for their retirement?

I bet most if not all have nice little nest eggs. Why? Because they make 400% more than the employee. So up the employees wages and they too can have nice little nest eggs. There is reason for the lowest savings rate since the Great Depression. It's because employees make very bad wages and congress is happy to see it.