There’s a well-worn statistic from Pew Research that says roughly 10,000 Boomers will turn of retirement age every day for the next decade. That translates into a lot of people leaving the workforce. We talk about it from a hiring and talent perspective. But what about when employees retire?
Many articles have been published about Boomers not having enough savings for when they retire. In fact, I recently ran across the term “Threshold Generation” to describe individuals nearing retirement who saw their savings disappear, hence being on the threshold of retirement. According to a 2015 Federal Reserve Report, 31 percent of non-retired people said they have no retirement savings or pension whatsoever. Additionally, a 2013 report by the National Institute on Retirement Savings found that the average near-retirement household had only $12,000 in planned savings.
Among workers who do not participate in a 401(k) or other defined contribution plan, 42 percent say it’s because their employer does not offer one. Furthermore, among part-time workers, a 2015 BLS Economic Release found that 62 percent don’t have access to a savings plan at work for when they retire.
If you haven’t already seen this, to address the nation’s retirement savings gap, the U.S. Treasury launched myRA, a retirement savings account for employees who don’t have access to a savings plan at work or have not found an easy way to start saving, such as part-time and seasonal employees.
myRA is designed to remove common barriers to saving, and give people an easy way to get started,” said U.S. Treasury Secretary Jacob J. Lew. “myRA has no fees, no risk of losing money and no minimum balance or contribution requirements. To make saving easier than ever, you can now put savings into myRA directly from your bank account.
I’m not a certified financial planner. So I’m not here to tell anyone how to save and invest their money. But I do know that if individuals are unable to care for themselves financially, it will have an impact on business and our roles as human resources professionals. In fact, I ran across an article recently talking about the possibility of mandatory retirement savings programs being introduced in Congress.
Financial literacy, that includes retirement, needs to be a part of workplace well-being programs. From a business perspective, we want our employees to have satisfying, engaging, productive careers with our organizations. We also want them to have satisfying retirements when the time comes.
Oh, a quick P.S. About a year ago, I started reading Retirement Security SmartBrief. It’s a curated collection of articles about preparing to retire. I’ve found it to be interesting and very diverse in thought. Just in case you want to check it out.
Image courtesy of Sharlyn Lauby while appreciating street art.0