Roadblocks to Retirement
A 401(k) is the most-wanted benefit, after health insurance
A recent survey of 2,000 Americans, half between the ages of 18–29 and half between 30–64, looked at how these groups plan for retirement. Across the board, retirement plans are the most-wanted benefit, after health insurance1 (Human Interest, 2022). Additionally, an astonishing nine in 10 industrial workers believe they need an office job in order to even start saving for retirement.
Roadblocks to Retirement: Myths & Misconceptions
Companies with a retirement plan have lower turnover rates
In a separate analysis, we also found that offering a 401(k) plan may lead to lower turnover rates for small to medium-sized businesses. We compared the turnover rates of companies that offer a Human Interest retirement benefit to their employees vs. average turnover rates from the U.S. Bureau of Labor Statistics and found that 91% of companies with less than 10 employees have a lower turnover rate. Additionally, companies with:
10-49 employees have a 74% lower turnover rate
50-249 employees have a 73% lower turnover rate
250-999 employees have a 77% lower turnover rate
You’re never too old to start saving
Nearly half of all survey respondents (47%) said they think you can be “too old” to start saving for retirement. However, 44% of all respondents said they’re using their company’s retirement savings plan, with 30–64-year-olds more likely than 18–29-year-olds to do so (48% vs. 39%).
Additionally, to ensure they hit their retirement age, 37% would leave a job they liked for a better-paying one they liked less, and 32% would change jobs to one with a better 401(k).
Benefits employees want
At Human Interest, when we think about compensation, we frame it as total rewards for our employees (we’re hiring, by the way!), which includes all of the elements that go into recruitment and retention – benefits, salary, culture, flexibility, and more. But what are employees looking for? According to the survey, a retirement plan (34%) is the most-wanted benefit after health insurance (35%). Interestingly, paid or unpaid leave (27%) is in the middle of the list.
Additional benefits that employees are looking for include: flexibility to work remotely or a hybrid schedule (31%), life insurance (31%), wellness benefits (28%), dental insurance (28%), bonus structure (26%), and mental health services (25%). Vision insurance, stock options, and pet insurance also made the list.
Education is key
Nearly three-fourths (73%) of employees wish they had better 401(k) guidance at work; only 5% disagree.
To provide education, there are some simple yet highly effective steps you can take to support your employees:
Provide a subscription to online libraries, such as LinkedIn Learning
Offer lunch and learns with your retirement plan provider
Create a newsletter or blog with tips and tools (for inspiration, see the Human Interest Learning Center)
The path to saving more
67% of employees say that knowing they are missing out on match money would motivate them to increase their savings
52% of employees believe they should max out their 401(k), but only 12% of plan holders saved¹ the statutory maximum contribution
53% of employees believe if there’s no match they shouldn’t contribute to their 401(K), but a 401(k) is a powerful, tax-advantaged savings tool - even without an employer match
74% of employees say savings on autopilot would motivate them to increase their savings.
66% of employees say seeing others regularly saving would inspire them to save more.
1 in 10 workers don’t know if their employer offers a 401(k). If your employer does not, you can ask your manager or boss about a plan for your company.
This online survey of 2,000 US adults was commissioned by Human Interest and conducted by market research company OnePoll, in accordance with the Market Research Society’s code of conduct. Data was collected between March 14-15, 2022. All participants are paid an amount depending on the length and complexity of the survey. This survey was overseen and edited by the OnePoll research team, who are members of the MRS and have corporate membership to ESOMAR and AAPOR.
Subscribe to our Retirement Roadmap newsletter
Retirement isn’t just a destination. It’s a journey, and we’re here to help you. Our newsletter delivers succinct and timely tips, reviewed by Financial Advisors, to help you navigate the path to financial independence.