Nearly three-quarters, 74 percent, of employers who offer a defined contribution plan believe their employees' retirement readiness is a critical measure of whether their current retirement benefits program is a success, according to the LIMRA Secure Retirement Institute.
"When you consider that 80 percent of full-time U.S. workers rely on an employer-sponsored retirement savings plan to support their future retirement lifestyle, it is encouraging to see so many plan sponsors understand how integral their retirement benefits are to their workers' ability to achieve a financially secure retirement," Alison Salka, corporate vice president and LIMRA SRI Research director, said.
"In the past, plan sponsors focused on their employees' participation and contribution rates with little attention to the how the employee will use these assets in retirement. But as more employees rely primarily on their DC assets to fund their retirement, our industry has been communicating the need to offer their employees options for de-accumulation phase as well to truly prepare their employees for retirement."
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Employers said the top issues driving their retirement benefits strategy were helping employees save enough for retirement (38 percent); being competitive to attract quality employees (19 percent); and increasing costs of non-retirement benefits (14 percent).
LIMRA SRI research also found that nearly a quarter of plan sponsors don't offer a retirement income option in their retirement savings plan and half say there is not strong demand for such products.
But previous LIMRA SRI research showed that the overwhelming majority of employees did want access to retirement income products in their plan, with 80 percent saying employers should provide ways to convert savings into retirement income.
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