The numbers are in — more employees are focused on retirement. Too bad they’re not prepared for it.
According to a report from Financial Finesse, a provider of workplace financial wellness programs, 32% of questions received by the company’s certified financial planner from 2012 were regarding retirement planning, 25% in 2011. On top of that, 39% of employees reported running retirement plan projections in the first half of 2012, versus 33% in the first half of 2011.
Even with that increased interest, the report shows that employees are still behind where they need to be in order to retire comfortably at their desired retirement age.
As of June 30, 2012, 51% of employees surveyed said they didn’t have an emergency fund in place, and 33% reported not having a handle on their personal cash flow. This could explain why employees aren’t making more dramatic improvements to their preparedness despite short-term economic improvements.
Poor financial wellness and expected economic challenges on the horizon put employees at risk of having to delay retirement or retire with insufficient savings.
What can help
Auto-enrollment and auto-escalation provide a good foundation for 401(k) enrollment, but it’s clear that more needs to be done — especially in this economy.
Prepare employees for the challenge of understanding their 401(k) and retirement options by utilizing one-on-one services with a financial expert. Group information sessions can also go a long way in getting more people interested and proactive about their retirement.
Of course, it also can’t hurt to share an infographic, like this, that clearly explains the ins and outs of retirement planning.
What does your business do to keep employees in the know about retirement planning? Let us know in the comments below.