Do employees recognize the importance of saving for retirement?

The economic fallout from the pandemic has led to a national discussion of the future of the workplace. Regardless of how the nature of work changes, however, nearly everyone agrees that it is important for people to be able to save money for retirement while they still are working.

AARP asked 1,000 voters ages 25 and older about retirement savings. Among the key findings:

• More than six in 10 are anxious about having enough money to live comfortably throughout their retirement years.
• Only three in 10 believe they will be able to save enough money for retirement.
• Among voters ages 45-plus who are not yet retired, eight in 10 wish they had more money saved for their retirement years.
• Roughly two in three employed voters say they currently are participating in a workplace retirement savings plan offered by their employer. These voters almost universally (96 percent) say that having a workplace retirement savings plan is important in helping them save for retirement.
• Nine in ten agree that elected officials should support legislation that makes it easier for all workers to save for retirement from their paycheck.

Important retirement plan features

Nine in ten also support establishing a program to help workers save for retirement at work if their employer does not currently offer them a way to save. Voters say that each of the following would be important features of such a program:

• Portability, so workers can take their accounts with them when changing jobs (99 percent very/somewhat important).
• Available to all employees who do not have a way to save for retirement at work, including those who work for small businesses (98 percent very/somewhat important).
• Payroll deduction, so contributions are automatically deducted from each paycheck and deposited into a retirement account set up in each worker’s name (96 percent very/somewhat important).
• Voluntary, so participants are not required to contribute (90 percent very/somewhat important).

AARP researchers drew three conclusions from the survey results:

• The ability to save money for retirement while working is critically important for financial security later in life.
• Workplace retirement savings programs are an important tool in helping people save for retirement.
• Elected officials should support legislation that makes it easier for all workers, including those in small businesses, to save for retirement from their regular paychecks.

“Regardless of their political leanings, vast majorities of voters surveyed are in favor of action to facilitate workplace retirement savings by all workers,” the survey report concluded.