Nearly all (98 per cent) U.S. employees believe it’s important for their employer to provide a retirement savings plan, according to a new survey by Vestwell Inc.
The survey, which polled roughly 1,300 employees and 250 employers, found nearly three-quarters (72 per cent) of employees said they expect employers to offer a 401(k) or 403(b) retirement savings plan in light of the tight labour market. Indeed, nearly half (47 per cent) of workers listed retirement as their No. 1 savings goal, followed by paying off debt (34 per cent) and saving for health-care expenses (nine per cent).
While two-fifths (40 per cent) of employees said a higher salary would encourage them to contribute to a workplace retirement plan, others cited a higher employer-matching contribution (28 per cent), better financial education (eight per cent) and paying off personal debt (six per cent) as motivating factors. Just 12 per cent said nothing would motivate them and six per cent cited other motivations.
While the majority (91 per cent) of employees said they were interested in adding a guaranteed lifetime income stream such as a deferred annuity, just 40 per cent of employers expressed an interest in making this savings solution available.
More than three-quarters (76 per cent) of employees reported some level of stress regarding their financial situation, including two-thirds (66 per cent) who agreed that inflation and market volatility has increased their previous levels of financial stress. As well, 48 per cent said they believe they should be saving more for retirement in the current economic climate.
The vast majority (90 per cent) of workers said their employer should be involved in retirement education and more than half (59 per cent) agreed or strongly agreed that companies should have responded to the ‘Great Resignation’ with a more hands-on approach to providing retirement information.