Broker Check

Retirement Confidence

| May 04, 2020
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If we could just take a minute and rewind in our minds back only a few months (although it might feel like decades) to January of this very year. At that time the Employee Benefit Research Institute (EBRI) conducted their annual Retirement Confidence Survey.  According to their results 69% of workers felt confident they would have enough money to live comfortably in retirement and 67% of workers are confident they are doing a good job preparing for retirement, although 61% still reported that preparing for retirement did cause them stress.  (2020 Retirement Confidence Survey Summary)

Question number 1: Would you/your employees been the groups feeling confident about their retirement's back in January?

Question number 2 (and most importantly): Would you/they still fall into those categories now as we sit on the doorstep of May?

Realizing that the world had changed rather significantly since January, EBRI sent out a supplemental survey of questions to try and see if feelings in late March were any different than they had been just a couple of months earlier. What they found was that the numbers did drop, but not as much as one would probably anticipate. In January the number of those confident sat at 69%, in March it was down to 63%. Not an insignificant drop by any means given only 60-ish days had passed but still a strong majority. (April 2020 Survey Press Release)

One reason for the confidence comes from the fact that almost half (48%) of workers surveyed said they have tried to calculate how much they need to save for their retirement planning, an increase of 10% from just 2 years prior. (April 2020 Survey Press Release) This is usually one of the toughest, but most important, steps an employee can take to creating a retirement plan for themselves and getting into a position to even possibly assess their confidence in being able to reach that goal.

The problem is...the other half. A 10% increase in two years is good, but that means one out of two employees still aren't taking that biggest first step. Why not? Simple answer is that most don't know how although, thanks to technology, the number of folks who are (theoretically) capable of doing this on their own has increased exponentially. Moral of the story apparently is you can lead an employee to the tools and still only half of them will drink, or something like that.

Is there someone available to you and your employees to help get them into the "good half" of that group? Tools are great but only if they get used, someone who can engage an employee and help them get the most out of those tools can be just as important. A financial advisor willing and able to bring the tools to the employees and really show them how to get the most out of them can make a huge difference into which group an employee falls.

Spring Music Thoughts: At this time of year I, like many people I tend to drift towards more upbeat tunes as the weather turns warmer and each passing day gets a little longer but, at the end of the day, I will always be a sucker for sad songs. With that in mind, last weekend got a little bit better for me when I got home to find the new album from American Aquarium, Lamentations, waiting on my doorstep for me.

"I've long set fire to things I love/Told myself I don't deserve/To ever have and hold that kind of glory/But I'll come back in a couple days/To search the ash and memory/And start paintin' my side of the story

Lyrics like that from the song "The Day I Learned How to Lie to You" always hit me like a ton of bricks and the main reason I always come back to this particular band.

That's it for me this go round, hope everyone is staying safe! I/we are going to start trying to do these more frequently so, if anyone out there is actually reading them, you'll hopefully start to see them closer to weekly instead of monthly. 

 Any opinions are those of Matt Callan and not necessarily those of Raymond James.  Expressions of opinion are as of this date and are subject to change without notice.  There is no guarantee that these statements, opinions or forecasts provided herein will prove to be correct.  Investing involves risk and you may incur a profit or loss regardless of strategy selected.

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