Show Me the Finish Line 401(k) Savers Say They Want Help Understanding How Much They’ll Need for Retirement

Nachrichtenquelle: Business Wire (engl.)
15.09.2020, 15:00  |  101   |   |   

The area where 401(k) participants say they could most use help is understanding how much they’ll need to save for retirement, according to a nationwide survey of 1,000 401(k) plan participants from Schwab Retirement Plan Services.

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Catherine Golladay, Executive Vice President, Workplace Financial Services at Schwab (Photo: Business Wire)

Catherine Golladay, Executive Vice President, Workplace Financial Services at Schwab (Photo: Business Wire)

Over two thirds (68%) of participants gave an estimate of how long their retirement savings will last, with the average being 24 years. The remaining 32% say they do not know how many years their retirement savings might last, and the level of uncertainty is higher among women (40%) than men (25%).

On average, participants in the study plan to retire at age 65 and estimated they need to save $1.9 million for retirement. The top five areas they would like help with are:

  • Calculating how much they need to save for retirement
  • Anticipating tax expenses
  • Determining their retirement age
  • Creating an income stream in retirement
  • Receiving specific advice on how to invest their 401(k)

“Every step of the way, retirement planning is a constant balance between saving and spending. In the years before retirement, we have to meet our day-to-day financial commitments while still keeping an eye on our long-term savings goals. Once we get to retirement, we want to be able to enjoy our hard-earned savings, but also make them last, likely over a period of decades,” said Catherine Golladay, executive vice president and head of Workplace Financial Services at Charles Schwab & Co., Inc. “Talking to a financial professional can provide important clarity regardless of where you are on that journey. Even if you think your financial situation doesn’t warrant outside help, having that conversation with a professional is a valuable step to take.”

The study finds participants’ confidence in making investment decisions in their 401(k) increases significantly with the help of a financial professional. Almost half (49%) report they would be very confident in their investment decisions with help versus only a third (32%) feeling very confident on their own, yet only half (50%) of those surveyed said they felt their situation warrants financial advice.

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