Years ago, a worker could land a job and stay on until it was time to collect a gold watch and a pension. These days, it's up to workers to fund their own retirements, and 78 percent of them know this. The number is even higher, 84 percent, among those who participate in defined contribution plans.
So says a new survey from LIMRA Secure Retirement Institute Research, which also found that 77 percent of workers believe that everyone should have access to a retirement savings plan at work, and that retirement savings plans do work to help Americans prepare for the day when they'll leave the job behind.
For DC plan participants, the confidence factor in those plans is even higher, with 85 percent saying that they're an effective method of preparation for those long-awaited golden days.
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But only 60 percent of workers believe that those who save in a retirement savings plan are likely to have a secure retirement. And only three out of every 10 workers say that defined contribution plans will be their primary source of income, though younger workers (those under age 45) and participants in DC plans have a little more faith in them, with four out of 10 younger workers and about half of DC plan participants saying their plans will provide the majority of their retirement funding.
Those who are socking money away into a DC plan, though, are definitely more confident about having retirement the way they want it than those who aren't participating; 45 percent of participants have faith in their actions, while only 32 percent of nonparticipants have that kind of confidence.
"It is encouraging to see that so many Americans understand that their action — or inaction — during their working years can determine their financial security in retirement," Alison Salka, senior vice president, director LIMRA Research, said of the survey results. "Systematically saving throughout one's career is essential for the majority of Americans to attain their preferred retirement lifestyle once their working years come to an end."
The findings are based on a survey of 1,013 Americans in April.
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