The vast majority of U.S. benefits managers reported that their organizations do not do enough to help employees make critical decisions at the point of retirement, according to new survey commissioned by Transamerica Retirement Management.
In fact, 80% of respondents were unsure or disagreed that their organization sufficiently prepares employees to successfully manage their financial resources.
In addition, the vast majority of benefits managers weren’t confident in how capable employees are at making sound decisions about retirement preparation. Thirty-five percent rated employees as either “somewhat not capable” or “not capable,” while 45% rated employees’ capabilities as “neutral.”
More than 80% of benefits managers voiced concern that their employees are not “financially ready” to retire. Survey participants also said most employees don’t understand how to plan for the various needs and contingencies that can arise once they leave the workplace, including the cost and factors to consider in maintaining their desired lifestyle.
The survey respondents agreed that the employer shares – almost equally with the individual – the responsibility to support the individual through retirement. Respondents said that employees, employers and government shoulder 41%, 37% and 21% of the responsibility, respectively.
“These survey findings help debunk a myth that just providing employees with more retirement-related information or education will generate better retirement outcomes,” said Phil Eckman, chief executive officer, Transamerica Retirement Management.
“For decades, employers have devoted a wide range of retirement resources, matching retirement plan contributions, employee-education efforts and the like, toward the goal of helping their employees enjoy positive retirement lifestyles,” he noted. “Add in the immense resources of the Internet and today’s employees should, theoretically, be better equipped than ever to make good decisions. But the nation’s benefits directors are telling us the opposite.”
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