Survey results like the one from NIRS, mentioned above, often show workers are not confident they have sufficient funds for retirement. DC plans, in conjunction with social security and other savings, should enable individuals to accumulate enough savings to enable them to have a financially secure retirement. Why then, are survey results so discouraging? Four poor choices made by DC plan participants are often cited as negatively impacting the participant’s ability to accumulate sufficient retirement savings:

  1. Eligible employees not participating in an available qualified plan.*
  2. Eligible employees participate in a qualified plan but do not save (contribute) enough.
  3. Participants make poor investment choices.
  4. Participants drain their accounts prematurely through loans and other withdrawals.

* Learn ways to increase participation among eligible employees here.